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Government  Policy  in  Aid  of 
American  Shipbuilding 


An  Historical  Study  of  the  Legislation 

Affecting    Shipbuilding    from ' 

Earliest  Colonial  Times 

to  the  Present 


A  Thesis  presented  to  the  Faculty  of  the  Graduate  School  of  the  University 
of  Pennsylvania  in  partial  fulfillment  of  the  require- 
ments for  the  degree  of  Doctor 
of  Philosophy 

BY 
WARREN  D.  RENNINGER 


# 

*•£, 


«*•». 

/ 


PHILADELPHIA 
1911 


Government  Policy  in  Aid  of 
American  Shipbuilding 


An  Historical  Study  of  the  Legislation 

Affecting    Shipbuilding    from 

Earliest  Colonial  Times 

to  the  Present 


A  Thesis  presented  to  the  Faculty  of  the  Graduate  School  of  the  University 
of  Pennsylvania  in  partial  fulfillment  of  the  require- 
ments for  the  degree  of  Doctor 
of  Philosophy 

BY 
WARREN  D.  RENNINGER 


PHILADELPHIA 
1911 


. 


CONTENTS 

PAGE 

Introduction 1 

PART  I.    POLICY  BEFORE  1789 

Earliest  Aids 2 

The  Beginnings  of  American  Shipbuilding 2 

The  British  Navigation  Acts 3 

Inducements  for  Shipbuilding 5 

The  Failure  of  Bounties 5 

Discriminating  Import  Duties 6 

Discriminating  Tonnage  Duties 7 

Aids  to  the  Production  and  Conservation  of  Shipbuilding  Materials 10 

Bounties  on  Hemp  and  Naval  Stores 10 

Inspection  and  Supervision  of  Production 13 

Conservation  of  Materials 13 

Legislation  by  the  States,  1776  to  1789 14 

Commercial  Liberty  and  Ruin 14 

Retaliation  and  Protection 16 

Summary  of  the  Policy  before  1789 20 

PART  II.    NATIONAL  POLICY  SINCE  1789 

Discriminating  Duties 22 

Import  Duties  Favoring  American-built  Ships 22 

Tonnage  Duties  Favoring  American-built  Ships 24 

Light  Money  on  Foreign  Vessels 25 

American  Registry 26 

Restricted  to  Ships  of  Domestic  Build 26 

Later  Modifications 27 

Bounties  for  the  Fisheries 27 

The  Coasting  Restriction  in  the  Navigation  Act  of  1817 28 

Coastwise  Trade  Reserved  for  American-built  Ships 28 

Building  the  Fleet  on  the  Great  Lakes 30 

Government  Aid  in  Establishing  Steamship  Building 30 

Mail  Subsidies  Under  the  Acts  of  1845  and  1847 31 

Naval  Demands  of  the  Civil  War 35 

Government  Work  in  Private  Establishments 36 

War  Taxes 37 

The  Burdens  of  Import  Duties  and  Internal  Revenue 37 

Mail  Subventions,  1864  to  1875 39 

The  Brazilian  Contract 39 

The  Pacific  vlail  Contracts 40 

iii 


288993 


IV  CONTENTS 

Tariff  Concessions  to  Aid  Shipbuilding 42 

Materials  for  Wooden  Vessels  on  Free  List,  1872 44 

Free  Materials  for  Vessels  Built  on  Foreign  Account,  1884 44 

Materials  for  Iron  and  Steel  Vessels  on  Free  List,  1890 44 

Modifications  in  Tariff  Act  of  1909 45 

American  Registry  Policy  Since  the  Civil  War 45 

Exclusion  of  Vessels  Alienated  During  the  War 45 

Admissions  by  Special  Acts 46 

The  "Free  Ship"  Agitation 47 

Nationalization  of  Hawaiian  and  Porto  Rican  Shipping 52 

Extension  of  Coasting  Laws  to  Over-Sea  Possessions 52 

The  Ocean  Mail  Act  of  1891 53 

The  Inadequacy  of  the  Act  of  March  3,  1891 53 

Proposed  Modifications 54 

Recent  Naval  Policy 55 

The  Naval  Advisory  Board  of  1881 55 

The  Adoption  of  a  New  Policy 56 

The  Fundamental  Act  of  August  3,  1886 57 

Private  Establishments  Building  a  Modern  Navy 59 

The  Influence  of  the  Spanish  American  War 59 

Dreadnaughts  and  Efficient  Shipyards 60 

Conclusion 61 

Bibliography 63 


INTRODUCTION 

Shipbuilding  is  one  of  the  oldest  industries  of  the  United  States. 
From  earliest  times  it  was  one  of  those  fundamental  industries  that 
formed  the  economic  basis  for  the  growth  of  the  country;  and  the 
industry  continued  to  be  one  of  the  most  important  in  the  United 
States  down  to  the  Civil  War.  Since  then  shipbuilding  has  not  en- 
joyed a  proper  share  of  the  general  progress  and  prosperity  of  Amer- 
ican industries,  and  the  United  States  has  not  been  able  to  build 
ships  as  cheaply  as  they  can  be  built  in  some  of  the  European  coun- 
tries. 

The  loss  of  our  prestige  as  shipbuilders  has  been  a  matter  of 
chagrin  to  all  patriotic  citizens  and  a  special  grievance  to  those 
engaged  in  shipbuilding  and  navigation.  Therefore,  citizens 
interested  in  our  national  welfare,  have  united  with  shipbuilders  and 
shipowners  in  imploring  the  aid  of  the  government  to  restore  the 
industry  to  the  high  place  which  it  occupied  before  the  Civil  War. 
Shipowners  have  been  demanding  "free  ships,"  i.e.,  the  privilege 
of  buying  vessels  in  foreign  countries  where  they  could  be  bought 
cheapest  and  have  them  admitted  to  American  registry.  Shipbuilders 
have  vigorously  opposed  this  demand  and  have  insisted  on  their 
right  to  share  in  the  "protection"  given  American  industries  and 
have  sought  further  relief  in  bounties  and  subsidies.  Patriotic 
citizens  have  generally  supported  the  shipbuilders  in  opposing  the 
admission  of  foreign-built  vessels  to  American  registry.  They 
have  insisted  that  shipbuilding  should  be  protected  in  order  that 
this  country  might  maintain  its  commercial  and  naval  prestige. 

The  special  interest  of  the  government  in  shipbuilding  is  the 
maintenance  of  a  sufficient  naval  power.  This  requires  well  equipped 
shipyards  and  skillful  shipbuilders,  but  it  requires  also  a  successful 
merchant  marine  and  men  accustomed  to  maritime  life.  The  gov- 
ernment is  also  interested  in  our  commercial  advancement.  To  be 
commercially  independent  we  must  build  our  own  ships.  For  such 
reasons,  the  most  enterprising  countries  of  the  world  have  extended 
government  aid  and  protection  to  shipbuilding. 

In  view  of  these  facts,  it  may  be  of  interest  to  know  what  has 
been  the  policy  of  the  government  in  dealing  with  American  ship- 

1 


2  GOVERNMENT  AID   TO  AMERICAN  SHIPBUILDING 

building.  To  learn  the  general  history  of  this  policy  is  the  purpose 
of  this  study.  The  chief  difficulty  encountered  in  tracing  this  his- 
tory lies  in  the  fact  that  most  of  the  legislation  affecting  shipbuild- 
ing has  dealt  primarily  with  commercial  policy  or  with  navigation 
and  only  indirectly  affected  shipbuilding.  Within  the  limits  of  this 
brief  account,  no  place  can  be  given  to  the  history  of  the  general 
commercial  legislation,  nor  even  to  the  legislation  dealing  with  ship- 
ping which  affected  shipbuilding  only  very  indirectly  by  increasing 
the  demand  for  vessels  which  grew  out  of  increased  trade  and  navi- 
gation. It  has,  therefore,  not  been  possible  to  explain  fully  the 
economic  and  political  conditions  that  gave  rise  to  the  various  fea- 
tures of  the  policy  adopted  by  the  government.  This  monograph 
deals  only  with  the  main  features  of  the  legislation  that  has  most 
affected  the  shipbuilding  industry.  It  is  a  general  survey  from  earli- 
est colonial  times  down  to  the  present.  Proposed  legislation  which 
failed  to  become  law  is  almost  entirely  omitted  as  are  also  the  con- 
troversies in  Congress  and  throughout  the  country  which  raged 
over  questions  arising  out  of  the  interest  of  the  government  in  ship- 
building. > 

> 
PART  I.    POLICY  BEFORE  1789 

THE  EARLIEST  AIDS 

The  beginnings  of  American  shipbuilding  are  not  founded  in 
legislation  but  in  the  environment  of  the  early  settlers.  New  Eng- 
land was  the  cradle  of  our  maritime  industries.  Here,  the  poverty 
of  the  soil  and  the  wealth  of  the  sea  made  the  early  settlers  a  mar- 
itime people — fishermen,  shipbuilders,  sailors  and  traders.  Fishing 
became  at  once  an  important  source  of  food  and  soon  developed  into 
a  regular  industry  of  fundamental  importance.  Along  with  it  grew 
the  shipbuilding  industry.  As  early  as  1624,  the  industry  began  to 
be  carried  on  regularly  at  Plymouth,  some  shipcarpenters  having 
been  brought  from  England  for  the  purpose.  In  the  same  year 
some  persons  of  Dorchester,  England,  sent  over  fishermen  and  made 
the  necessary  provisions  for  a  fishery  at  Cape  Ann.1 

In  1629^  a  year  before  the  settlement  of  Boston,  six  shipwrights 
were  sent  to  the  Massachusetts  Bay  Colony.  They  were  to  be  main- 

1  Hutchinson's  History  of  Massachusetts  Bay  Colony,  i,  7. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  3 

tained  at  public  cost,  two-thirds  to  be  paid  by  the  general  company 
and  the  other  third  by  Governor  Craddock  and  his  associates  in- 
terested in  a  private  stock.  The  same  year  a  supply  of  materials 
for  building  and  equipping  ships  including  pitch,  tar,  rosin,  oakum, 
old  ropes  for  oakum,  cordage,  sail-cloth,  and  nails  were  sent  over 
from  England  for  the  use  of  the  shipwrights.  It  was  also  ordered 
that  a  storehouse  should  be  provided  for  the  materials  and  the  tools 
of  the  shipbuilders.2  When  this  colony  was  in  the  straits  of  its  first 
years,  Governor  Winthrop  found  it  necessary  to  build  the  Blessing 
of  the  Bay  to  import  corn  from  the  southern  Indians.3 

The  colonial  legislatures  found  occasion  to  encourage  shipbuild- 
ing almost  from  the  beginning.  In  the  ninth  year  after  the  settle- 
ment of  Boston  an  act  of  the  Massachusetts  Bay  Colony  excused  all 
those  engaged  in  shipbuilding  from  military  training.  This  act  also 
gave  indirect  aid  to  shipbuilding  by  exempting  from  taxation  all 
property  and  men  employed  in  fishing.4  Two  years  later  this  col- 
ony passed  a  law  providing  for  the  inspection  of  all  ships  above 
thirty  tons  built  within  the  colony.  Under  this  act  shipbuilders 
were  required  to  perform  their  work  "  according  to  the  rules  of  their 
art"  and  the  inspectors  bound  under  oath,  were  empowered  "to 
cause  any  bad  timber  or  other  insufficient  work  or  materials  to  be 
taken  out  and  amended  at  the  charge  of  them  through  whose  fault 
it  grows."5  These  laws  were  re-enacted  from  time  to  time  and  were 
in  force  in  the  early  part  of  the  eighteenth  century  if  not  throughout 
the  century. 

It  was  of  great  advantage  to  the  growth  of  American  shipping 
and  shipbuilding,  that  from  the  beginning  foreign  ships  were  more  or 
less  excluded  from  the  British  colonial  trade.  At  first  this  was  ac- 
complished by  charter  provisions,  royal  proclamations  and  instruc- 
tions to  governors,  later  by  the  "navigation  acts."6  Under  the  earlier 
navigation  act  colonial  trade  was  restricted  to  English  ships.  But 

2  Records  of  Massachusetts,  i,  394,  402. 

3  Hutchinson's  History  of  Massachusetts  Bay  Colony,  i,  91. 

4  Hutchinson's  History  of  Massachusetts  Bay  Colony,  i]  91 ;  Records  of 
Massachusetts,  i,  258. 

5  General  Laws  and  Liberties  of  the  Massachusetts  Colony,  Revised  and  Re- 
printed by  order  of  the  General  Court  holden  at  Boston,  May  15,  1672,  p.  138. 

e  For  a  complete  study  of  British  policy  before  1660  see  Beer,  Origin  of 
the  British  Colonial  System,  1578  to  1660. 


4  GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING 

the  act  of  16607  required  that  all  trade  between  England  and  her 
colonies,  as  well  as  all  intercolonial  trade,  had  to  be  carried  in  English- 
built  ships  which  were  owned  and  manned  by  English  or  colonial 
merchants  and  seamen.  Some  question  arose  as  to  the  definition  of 
English-built  ships  so  this  was  more  exactly  explained  in  the  naviga- 
tion act  of  16628  to  mean  only  those  lawfully  registered  on  October 
1,  1662  and  those  built  in  England  or  in  the  English  colonies.  All 
others  were  excluded  from  the  privileges  of  English  ships. 

The  act  of  1660  also  required  that  certain  "  enumerated  articles" 
including  sugar,  tobacco  and  dye-woods  produced  in  the  colonies 
should  be  sent  only  to  English  dominions.  Later  modifications  in- 
creased the  list  of  "enumerated  articles"  and  for  the  benefit  of  Eng- 
lish merchants,  in  1663,  England  was  made  a  "Staple"  for  European 
goods  which  were  to  be  sent  to  the  colonies.9  In  1706,  naval  stores, 
tar,  pitch,  turpentine,  hemp,  masts,  and  yards  were  added  to  the  list 
of  "enumerated  articles."  The  increasing  number  of  "enumerated 
articles"  which  the  colonies  could  export  only  through  England  and 
the  requirement  that  commodities  produced  in  Europe  could  be  im- 
ported to  the  colonies  only  from  England  practically  excluded  for- 
eign ships  from  all  the  important  colonial  trade.  The  "navigation 
acts"  thus  made  it  illegal  for  foreign-built  ships  to  get  any  consider- 
able share  of  the  trade  with  the  American  colonies.  Colonial  ship- 
builders profited  under  this  protection  not  only  to  the  extent  of  the 
American  demand  but  they  built  so  many  ships  for  owners  in  the 
mother  country  that  more  than  one  protest  was  made  by  British 
shipbuilders  to  their  government.10 

This  early  protection  and  encouragement  was  successful  in  es- 
tablishing shipbuilding  in  the  northern  colonies.  By  1700  Boston 
had  194  vessels  registered  including  25  ships  between  100  tons  and 
300  tons  and  39  ships  under  100  tons.  The  remainder  comprised 
50  brigantines,  13  ketches  and  67  sloops.  New  York,  where  ship- 

7 12  Car.  II,  ch.  18,  Statutes  of  the  Realm,  v,  246-250. 

8 14  Car.  II,  ch.  11,  Statutes  of  the  Realm,  v,  394^395. 

9 15  Car.  II,  ch.  7,  Statutes  of  the  Realm  v,  449-552. 

10  For  the  most  complete  and  most  scholarly  study  of  the  British  Colonial 
Policy  see  the  books  of  George  Louis  Beer,  Commercial  Policy  of  England  to- 
wards the  American  Colonies,  in  Columbia  University  Political  Science  Studies; 
British  Colonial  Policy,  1754  to  1765;  Origins  of  the  British  Colonial  System 
1578  to  1660. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  5 

building  began  in  161411  and  was  encouraged  by  concessions  from 
the  Dutch  West  India  Company,12  had  124  vessels,  6  of  which  were 
over  100  tons.  New  Hampshire  had  24  vessels.13  Each  of  these 
colonies  built  practically  all  of  its  own  ships.14 

INDUCEMENTS   FOR   SHIPBUILDING 

The  Failure  of  Bounties.  Protected  under  the  British  "nav- 
igation acts,"  shipbuilding  did  not  need  much  help  from  the  colo- 
nial legislatures.  However,  in  several  of  the  colonies,  the  industry 
did  not  flourish.  These  colonies,  ambitious  to  supply  their  own  ship- 
ping, offered  special  inducements  to  shipbuilders.  Thus,  Virginia 
in  1662,  granted  a  bounty  of  fifty  pounds  of  tobacco  per  ton  to  any- 
one who  would  build  a  seagoing  vessel  in  the  colony.  Later  in  the 
year,  the  assembly  increased  the  bounty  offered  by  allowing  fifty 
pounds  of  tobacco  per  ton  as  before  if  the  ship  was  not  less  than 
twenty  tons  nor  more  than  fifty,  but  if  the  ship  was  between  fifty  and 
a  hundred  tons  then  the  bounty  was  to  be  a  hundred  pounds  per  ton, 
and  two  hundred  pounds  per  ton  if  the  ship  exceeded  a  hundred  tons. 
It  was  also  provided  that  a  vessel  so  built  could  not  be  sold  out  of 
the  colony  within  three  years.15  These  bounties  produced  very 
slight  results,  although  thirteen  hundred  pounds  of  tobacco  were 
paid  for  the  construction  of  one  small  ship.16  In  1666,  the  assembly 
withdrew  all  these  bounties. 

The  general  failure  of  shipbuilding  in  Virginia  is  reflected  in  a 
report  of  the  governor  made  about  this  time  to  the  lords  commis- 
sioners of  foreign  plantations.  He  said  about  eight  ships  a  year 
came  to  Virginia  from  England  and  Ireland  and  a  few  New  England 
ketches,  but  Virginia  had  never  had  more  than  two  ships  and  these 
were  not  more  than  twenty  tons  in  size.  He  blamed  the  restric- 
tions of  the  navigation  acts  for  this  and  declared  that  shipbuilding 
flourished  in  New  England  only  because  the  shipowners  there  vio- 
lated the  laws.17 

11  Documents  of  the  Colonial  History  of  New  York,  i,  12. 

12  Documents  of  the  Colonial  History  of  New  York,  i,  401. 

13  Documents  of  the  Colonial  History  of  New  York,  iv,  790. 

14  Documents  of  Colonial  History  of  New  York,  iii  263. 

15  Hening,  ii,  122,  178. 

16  Hening,  ii,  204. 

"  Hening,  ii,  515,  516. 


6  GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 

In  New  York  bounties  were  also  proposed  about  1739,  but  never 
enacted.18  In  1751  South  Carolina  appropriated  one-fifth  of  the 
revenue  yielded  by  a  certain  impost  as  a  bounty  for  building  ships 
in  the  province  and  offered  inducements  to  shipwrights  and  calkers 
to  settle  there.19  Like  the  bounties  offered  a  century  earlier  by  Vir- 
ginia this  too  proved  ineffective  and  was  soon  repealed. 

Discriminating  Import  Duties.  A  much  more  common  method 
by  which  the  colonial  legislatures  aided  their  maritime  industries  was 
by  means  of  discriminating  duties  on  imports  and  on  the  tonnage  of 
ships  entering  their  ports.  The  primary  object  of  all  these  duties  was 
to  obtain  revenue,  but  they  were  generally  so  arranged  as  to  favor 
the  shipping  owned  by  inhabitants  of  the  legislating  colony  by  charg- 
ing them  lower  duties  or  exempting  them  entirely.  Indirectly  this 
benefited  the  shipbuilders  within  the  colony  by  increasing  the  de- 
mand for  ships.20 

More  direct  aid  was  given  to  shipbuilding  by  the  less  common 
practice  of  discriminating  in  favor  of  ships  built  within  the  colony. 
An  early  instance  of  this  is  a  law  enacted  by  the  Virginia  Assembly 
in  1691  which  admitted  foreign  wines  and  spirits  imported  in  ships 
owned  by  Virginians  upon  payment  of  half  the  regular  duties  and  if 
the  ships  were  built  in  Virginia  the  goods  were  to  be  imported  free 
of  duty.  This  discrimination  in  favor  of  Virginia-built  ships  was 
continued  in  force  only  three  years.21 

Maryland  also  favored  her  own  shipbuilders  in  the  act  of  1699 
which  provided  that  rum  and  wine  imported  in  ships  built  in  the 
province  and  solely  belonging  to  the  inhabitants  thereof  should  be 
exempted  from  the  usual  import  duty  of  3d.  per  gallon.  A  similar 
discrimination  is  also  embodied  in  the  act  of  1715  which  imposed 
an  import  duty  on  negroes,  liquors,  and  Irish  servants  imported,  but 
the  exemption  was  also  extended  to  ships  built  in  England  or  the 
plantations  when  owned  entirely  by  inhabitants  of  Maryland.22 

South  Carolina  also  discriminated  in  favor  of  her  own  ships  by 
providing,  in  1703,  that  vessels  built  and  owned  in  the  colony  should 

18  Giesecke,  American  Commercial  Legislation  before  1789,  pp.  71,  90,  93. 

19  Cooper,  Statutes,  iii,  742;  iv,  10. 

20  For  Study  of  the  commercial  policy  of  the  colonial  governments  see 
Giesecke,  American  Commercial  Legislation  before  1789. 

21  Hening,  iii,  88, 129. 

22  Laws  of  Maryland  at  Large,  collected  by  Thomas  Bacon,  1765. 


GOVEENMENT  AID   TO   AMERICAN   SHIPBUILDING  7 

pay  one-half  of  the  regular  import  and  export  duties  while  those 
built  elsewhere  but  owned  by  inhabitants  of  the  colony  should  pay 
two-thirds  of  the  regular  duties.  This  act  provided  a  comprehen- 
sive list  of  import  and  export  duties.  The  discriminating  feature 
was  repealed  the  following  year  when  there  was  passed  "an  Act  to 
make  all  Goods  Imported  and  Exported  in  any  Vessels  belonging  to 
the  Port,  to  pay  the  same  duties  as  if  Imported  in  Vessels  not  belong- 
ing to  the  same,  to  encourage  Navigation."23  In  1716  South  Caro- 
lina again  tried  to  encourage  shipbuilding  in  that  province  by  dis- 
criminating duties.  This  act  provided  that  all  liquors,  goods,  ne- 
groes, wares  and  merchandise  imported  in  any  vessel  wholly  owned 
and  built  in  the  province  should  be  admitted  free.  Goods  shipped 
in  vessels  built  but  not  owned  in  the  province  were  required  to  pay 
three-fourths  of  the  regular  duties.  This  act  was  repealed  on  March 
20,  1719,  after  the  lords  proprietors  had  nullified  it  the  preceding 
month  because,  as  they  declared,  it  was  against  the  interests  of  the 
mother  country.  English  merchants  had  entered  protests  against  the 
act  because  it  discriminated  against  English  ships.  To  overcome 
these  objections,  essentially  the  same  discrimination  was  framed 
somewhat  differently  in  the  repealing  act.  This  exempted  goods  im- 
ported in  ships  built  and  owned  in  the  province  from  all  duties  while 
those  imported  in  ships  built  but  not  owned  in  the  province  were 
liable  for  half  the  duties;  and  it  required  full  duties  of  those  brought 
in  vessels  that  were  both  built  and  owned  outside  the  province. 
The  proprietors  refused  their  assent  to  this,  but  it  remained  in  opera- 
tion until  the  act  of  1721  required  half  duties  on  imports  of  ships 
built  and  owned  in  South  Carolina  and  three-fourths  duties  when 
the  vessels  were  built  but  not  owned  or  owned  but  not  built  in  the 
province.24  Pennsylvania  also  favored  her  shipbuilders  in  1723  by 
providing  that  molasses  imported  in  ships  built  in  the  province 
should  be  exempted  from  the  regular  duty.  This  was,  however,  re- 
pealed the  same  year.25 

Discriminating  Tonnage  Duties.  Similar  discriminations  were 
made  in  the  imposition  of  tonnage  duties.  The  purpose  of  these 
duties  was  to  raise  revenue,  generally  for  harbor  defense  and  im- 
provements to  aid  navigation.  The  tax  was  often  levied  in  gun 

23  Cooper,  Statutes,  ii.  200,  235. 

24  Cooper,  Statutes,  iii,  32,  67,  169. 

26  Pennsylvania  Statutes  at  Large,  iii,  363,  416. 


8  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

powder;  hence  was  generally  spoken  of  as  "powder  tax"  or  " powder 
money."  With  a  purpose  of  raising  as  much  revenue  as  possible 
and  yet  of  hampering  trade  and  navigation  as  little  as  possible,  the 
home  shipping  of  the  colony  was  often  favored  or  exempted  entirely. 

Sometimes  the  discrimination  was  arranged  with  a  view  of  aiding 
shipbuilding  in  the  colony.  Thus,  South  Carolina  in  1698  imposed 
a  tax  of  half  a  pound  of  gunpowder  per  ton  on  every  ship  entering. 
It  was  provided,  however,  that  ships  built  and  owned  in  the  province 
should  not  be  required  to  pay  this  tax  and  ships  built  in  the  province 
and  whose  owners  are  not  inhabitants  of  the  province  should  pay 
half  duties.  This  act  was  to  continue  in  force  two  years.26  Some  of 
the  later  powder  duties  were  levied  with  similar  discrimination  as  in 
1741. 27  Maryland,  in  1704,  levied  a  tonnage  duty  of  3d.  per  ton 
on  all  vessels  trading  to  that  colony  excepting  those  built  in  the 
province  and  wholly  owned  by  inhabitants  thereof.  In  1715  the  ton- 
nage duty  was  revised  so  as  to  exempt  from  this  tax  all  ships  owned 
in  the  province. 

New  York,  in  1714,  exempted  vessels  built  or  wholly  owned  in 
that  province  from  the  tax  then  imposed  upon  shipping.  In  the  re- 
enactment  of  the  law  in  1716,  English  vessels  were  not  included  in 
the  exemption  until  the  Board  of  Trade  protested.  The  act  was 
then  modified  so  as  to  exempt  the  English  vessels  and  those  built  and 
owned  in  the  province,  but  not  those  merely  owned  by  inhabitants 
of  New  York.  This  discrimination  in  favor  of  New  York  shipbuilding 
had  little  effect.  The  act  expired  in  1720  and  the  discrimination 
was  not  continued  after  that. 

In  1734  New  York  revived  the  tonnage  duty  with  discriminating 
features.  The  reasons  given  were  that  the  shipping  in  the  colony 
had  decreased  to  such  a  degree  that  their  carrying  was  done  almost  en- 
tirely in  vessels  of  other  ports,  that,  "in  most  of  all  the  other  British 
colonies  a  greater  duty  is  imposed  on  vessels  not  belonging  to  them- 
selves than  those  belonging  to  their  own  inhabitants,  though  under 
the  name  of  'powder  money'  or  some  other  denomination"  and  that 
it  would  benefit  the  inhabitants  in  general  and  the  shipwrights  in 
particular.  The  act  imposed  a  tax  of  3s.  a  ton  on  ships  entering, 
but  exempted  all  vessels  built  in  the  colony,  all  vessels  owned  by  in- 
habitants and  (in  order  to  avoid  the  objections  of  the  home  govern- 

26  Cooper,  ii,  151. 

27  Cooper,  iii,  588. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  9 

ment)  all  vessels  owned  by  inhabitants  of  Great  Britain.  Coasting 
vessels  were  also  exempted.  Unlike  most  tonnage  taxes,  this  had 
for  its  primary  object  aid  to  shipping  and  shipbuilding.  The  reve- 
nue was  to  be  used  for  harbor  defense.28 

The  discrimination  against  British  ships  by  the  colonial  legisla- 
tures brought  protests  from  the  English  merchants.  Chalmers29  tells 
of  such  a  protest  made  in  1716  to  the  Board  of  Trade.  This  protest 
declares  that  "in  Carolina  and  in  Pennsylvania,  wines  of  Madeira  pay 
in  the  first  double,  and  in  the  last  more  than  if  they  belonged  to  the 
livers  in  both;  and  the  like  impositions  are  laid  upon  vessels  that  are 
not  built  in  those  places,  to  encourage  their  own;  the  British  traders 
are  treated  as  aliens  in  their  own  colonies;  a  duty  is  likewise  laid  upon 
English  manufactures,  to  promote  their  own.  Now  the  proprietors, 
by  ratifying  such  acts  of  Assembly,  thereby  forfeit  their  charters;  else 
they  may  be  truly  termed  independent  of  the  crown  and  laws  of  Great 
Britain,  as  is  often  assented  in  those  assemblies."  The  Board  of 
Trade  gave  attention  to  the  matter  and  in  September  a  royal  order 
was  transmitted  to  the  governors  "to  pass  no  laws  which  may  effect 
the  trade  of  this  kingdom,  unless  their  operation  is  suspended  till 
the  royal  assent  is  obtained.30 

In  spite  of  this  order  discriminating  duties  were  continued  by 
the  colonial  governments.  Some  of  these  acts  were  put  in  force 
after  they  had  been  disapproved.  In  August  of  1731  a  petition  of 
London  merchants  was  sent  to  the  Board  of  Trade  setting  forth  that 
in  several  of  the  colonies  higher  duties  were  laid  on  goods  and  ships 
belonging  to  the  petitioners  and  other  persons  residing  in  England 
than  were  laid  on  the  goods  and  ships  of  the  colonists,  and  praying 
for  relief  from  this  injustice.  The  Board  of  Trade  was  then  directed 
(February,  1732)  to  send  instructions  to  the  governors  of  the  colonies 
in  America  to  the  effect,  "that  the  Governor  should  be  forbid  upon 
pain  of  His  Majesty's  displeasure  to  give  their  assent  for  the  future 
to  any  laws  wherein  the  Natives  or  Inhabitants  of  the  respective  col- 
onies under  their  Government  are  put  on  a  more  advantageous  foot- 
ing than  those  of  Great  Britain;  and  that  the  said  Governors  should 

28  Laws  of  New  York  from  1691  to  1751  inclusive,  published  1752,  pp.  221- 
222. 

29  History  of  the  Revolt  of  the  American  Colonies,  ii,  6. 

30  For  further  account  of  British  opposition  to  discriminating  duties  see 
Giesecke,  American  Commercial  Legislation  before  1789,  pp.  27-31. 


10  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

be  directed  to  pay  due  Obedience  to  his  Majesty's  Royal  Instructions 
whereby  he  hath  been  graciously  pleased  to  forbid  them  to  pass  any 
Laws  by  which  the  trade  or  navigation  of  this  Kingdom  may  be  any 
ways  affected."31 

These  royal  orders,  and  the  repeated  refusal  of  the  crown  to 
approve  of  the  acts  which  discriminated  against  British  vessels  fin- 
ally caused  the  colonial  legislators  to  exempt  British  ships  whenever 
they  exempted  those  of  the  colony.  As  among  the  colonies,  the  dis- 
crimination was  also  of  little  effect;  because  generally  they  exempted 
their  immediate  neighbors  or  else  they  exempted  those  which  would 
reciprocate  the  favor. 

AIDS  TO   PRODUCTION  AND   CONSERVATION  OF  SHIPBUILDING 
MATERIALS 

There  was  plenty  of  excellent  shipbuilding  timber  in  the  colo- 
nies, but  other  materials  used  in  building  and  equipping  ships  such 
as  hemp,  tar,  pitch,  iron,  etc.  had  to  be  produced.  Hemp  received 
special  attention  from  the  colonial  legislatures.  Maryland  offered 
bounties  for  raising  hemp  in  1671,  and  Virginia  under  the  act  of  1673, 
distributed  seeds  to  encourage  the  raising  of  hemp  and  flax.  In  1682 
her  legislators  passed  an  act  offering  a  bounty  for  the  production  of 
flax  seed  and  hemp.32 

It  was  not  until  the  eighteenth  century  that  this  policy  became 
general  throughout  the  colonies,  and  then  largely  in  response  to  the 
bounties  offered  by  England  on  naval  supplies  imported  from  the 
colonies.  England  adopted  this  policy  in  Queen  Anne's  reign  when 
the  Swedish  Tar  Company  refused  to  let  England  have  any  pitch  or 
tar  except  at  its  own  prices  and  required  that  these  commodities  should 
be  carried  to  England  in  Swedish  ships  only.  English  shipbuilding 
had  long  been  dependent  on  Denmark,  Norway,  Sweden  and  Russia 
for  its  material.  These  countries  exported  to  England  timber,  tar, 
pitch,  hemp  and  iron.  From  Russia  came  hemp  and  flax  to  the  value 
of  a  million  pounds  a  year.33 

These  imports  piled  up  a  very  great  balance  of  trade  against 
England  from  year  to  year  which  was  paid  in  money.  It  is  easy  to 

31  Acts  of  the  Privy  Council,  Colonial  Series,  1720-1745,  No.  247. 

32  Hening,  ii,  306,  504. 

33  For  a  more  complete  account  see  Beer,  The  Commercial  Policy  of  Eng- 
land, p.  91. 


GOVERNMENT   AID   TO   AMERICAN  SHIPBUILDING  11 

see  with  what  displeasure  the  Merchantilists  of  that  day  would  view 
this  unfavorable  balance  of  trade.  There  were  also  sound  reasons 
why  the  navy  of  England  should  not  have  to  depend  upon  these 
nations  for  supplies.  Besides  these  reasons  there  was  a  general  de- 
sire to  establish  industries  in  the  North  American  colonies  which 
would  enable  the  colonists  to  buy  English  goods  and  which  would 
keep  the  colonists  from  developing  manufactures  which  would  com- 
pete with  those  of  England. 

Under  the  influence  of  these  general  feelings  and  the  action  of  the 
Swedish  Tar  Company,  Parliament  passed  the  first  of  the  series  of 
acts  granting  bounties  on  naval  stores  imported  from  the  British  col- 
onies in  America.34  This  act  granted  a  bounty  of  £6  per  ton  on  hemp, 
£4  on  tar  and  pitch  and  £3  per  ton  on  rosin  and  turpentine  imported 
from  the  British  colonies.  Later  it  was  provided  that  the  queen 
could  appropriate  £10,000  for  the  employment  of  skillful  persons  and 
for  the  purchase  of  utensils  to  carry  out  the  policy  of  colonial  pro- 
duction of  naval  stores.  The  production  of  hemp  received  further 
encouragement  in  1721,  when  it  was  provided  that  it  should  be  ex- 
empted from  the  import  duty  in  England.  By  another  act35  the 
drawback  on  hemp  exported  from  England  was  taken  away.  This 
was  an  indirect  way  of  aiding  the  production  of  hemp  in  the  colonies 
since  it  raised  the  price  on  all  imported  from  England. 

These  bounties  offered  by  England  on  imported  naval  supplies, 
met  with  an  immediate  response  in  the  colonies  where  the  legislatures 
now  offered  bounties  for  the  production  or  the  exportation  of  these 
materials.  The  British  bounties  seem  to  have  been  sunicient  to  de- 
velop an  adequate  production  of  tar,  pitch,  rosin,  and  turpentine, 
but  hemp  and  flax  required  additional  aid  from  the  colonial  legisla- 
tures. All  the  colonies  offered  bounties  on  these  sometime  in  the 
eighteenth  century  and  most  of  them  continued  the  payments  through- 
out the  century.  Maryland  passed  such  an  act  in  170636  which  de- 
clares that  it  is  in  response  to  the  act  of  three  and  four  Anne,  that 
hemp  is  made  a  staple  in  this  province  at  6d.  per  pound  so  that  when 
tendered  in  payment  of  debts  at  these  rates  it  shall  be  good  in  law. 

Massachusetts  had  offered  bounties  a  few  years  before  the  en- 

34  3  and  4  Anne  C.  10;  12  Anne  Stat.  I  C.  12;  8  George  I  C.  12,  Sec.  1;  16 
George  II  C.  26;  24  George  II  C.  57;  31  George  II  C.  35. 
'5  4  George  II  C.  27,  Sec.  8. 
36 1706  Ch.  11  Sec.  2;  1724  Ch.  22  Sec.  2. 


12  GOVEKNMENT  AID  TO  AMERICAN   SHIPBUILDING 

actment  of  the  British  bounties  and  provided  penalties  of  double  the 
value  of  the  hemp  for  rope-makers  who  worked  up  inferior  hemp  for 
cables  and  rigging.  In  1708  a  bounty  of  9s.  4d.  was  offered  for  every 
hundred  and  twelve  pounds  of  well-cured,  water-rotted  hemp  pro- 
duced in  the  province.  At  the  expiration  of  this  act  after  ten  years, 
the  bounty  was  doubled  and  continued  for  another  ten  years.  Be- 
fore this  act  expired  there  was  offered  in  1725  an  additional  bounty 
of  4s.  8d.  per  hundredweight  to  any  one  person  who  produced  in  the 
same  year  two  hundred  twenty-four  pounds.  This  was  to  continue 
for  five  years.  In  1730  the  bounties  were  increased  to  29s.  per 
hundredweight  and  7s.  additional  were  to  be  paid  to  any  person  who 
raised  more  than  two  hundred  and  twenty-four  pounds  in  a  single 
year.37  Massachusetts  also  offered  bounties  for  the  raising  of  flax 
and  the  production  of  canvas  or  duck  for  sails.38 

New  Hampshire,  in  1707,  also  responded  to  the  bounties  offered 
by  the  statutes  of  three  and  four  Anne39  by  encouraging  the  inhabi- 
tants to  make  tar  for  export  to  England.  Tar  was  to  be  accepted 
at  the  treasury  as  payment  for  any  taxes  at  the  rate  of  25s.  per  barrel 
and  later  in  1719,  offered  a  bounty  of  12d.  a  pound  on  hemp  raised 
in  the  province.40  A  bounty  on  tar  was  also  authorized  by  an  act 
passed  by  the  Virginia  assembly  in  1722. 

The  other  colonies  offered  similar  bounties  for  the  production  of 
hemp  although  they  were  not  quite  so  common  in  the  second  half  of 
the  eighteenth  century  as  in  the  first  half.  The  acts  generally  required 
that  the  hemp  be  merchantable,  well-cured,  water-rotted,  cleaned 
and  suitable  for  making  good  cordage.  Inspectors  were  authorized 
to  see  that  only  such  hemp  received  the  bounty  and  in  some  cases 
they  were  authorized  to  prevent  hemp  of  a  poor  quality  from  being 
manufactured  into  ropes  or  cables  for  ships.  The  act  of  the  Pennsyl- 
vania assembly,  passed  in  1730,41  providing  for  stricter  inspection, 
authorized  the  inspectors  to  search  warehouses  and  ropewalks  for 

37  Acts  and  Laws  of  Her  Majesty's  Province  of  the  Massachusetts  Bay  in 
New  England,  1692  to  1726,  pp.  171, 265, 302,  417;  Acts  and  Laws  of  Massachusetts 
Bay  1692  to  1742,  p.  449.' 

38  Acts  and  Laws  of  Massachusetts  Bay  Colony,  1692  to  1742,  pp.  297,  408, 
528. 

39  C.  10. 

40  Acts  and  Laws  of  New  Hampshire,  1696  to  1771,  pp.  32,  146. 

41  Statutes  at  Large,  iv,  185  to  188. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  13 

inferior  hemp.  If  any  unsound  hemp  was  found  being  manufac- 
tured into  rope,  hawsers  or  any  form  of  ship  cordage,  the  officer  was  to 
seize  the  hemp  which  was  to  be  forfeited,  and  every  rope  manufac- 
turer was  required  to  take  an  oath  not  to  work  up  bad  hemp.42  The 
general  supervision  by  the  government  of  the  products  of  industry, 
especially  of  those  to  be  exported,  aided  in  the  production  of  a  good 
quality  of  tar,  pitch,  turpentine,  rosin,  etc.43 

Government  inspection  and  supervision  was  also  sometimes  ex- 
tended to  shipbuilding  itself  as  we  already  have  seen  in  the 
Massachusetts  act  of  1641.  Early  in  the  eighteenth  century, 
Connecticut  passed  a  similar  law.  This  required  every  ship  to  be 
built  under  the  supervision  of  inspectors  "who  are  to  take  care  that 
all  the  material  be  Sound,  Sufficient  and  Suitable  for  the  Occasion; 
and  that  the  work  be  done  and  performed  Strong,  Substantial  and 
according  to  the  Rules  of  the  Shipwrights  Art."44 

Some  of  the  colonies  also  tried  to  procure  a  supply  of  naval  stores 
and  shipbuilding  materials  by  exempting  them  from  import  duties. 
For  example  Pennsylvania  exempted  pitch  and  tar  from  the  general 
duty  of  3  per  cent  imposed  on  imports  by  the  act  of  1723.45  Connec- 
ticut thus  exempted  lumber  from  a  general  import  duty  of  5  per  cent 
in  1768.  Hemp  was  practically  always  exempted  in  all  the  colonies 
when  a  general  impost  was  made. 

Export  duties  were  also  used  to  reserve  the  supply  of  shipbuild- 
ing materials  in  those  colonies  which  felt  a  shortage.  Connecticut 
thus  placed  a  duty  on  the  exportation  of  lumber  in  1673  at  the 
rate  of  10s.  on  every  ton  of  ship  timber  and  3s.  per  hundred  feet  on 
two-inch  planks  and  other  sizes  in  proportion  when  shipped  to  the 
neighboring  colonies.46  This  was  continued  from  time  to  time  and 
in  1747  a  duty  on  all  kinds  of  ship  timber  was  doubled  to  20s.  per 
ton  when  exported  to  Massachusetts,  New  York,  Rhode  Island  or 
New  Hampshire. 

42  Pa.  Acts  dealing  with  bounty  on  hemp  1722  to  1732,  see  Statutes  at  Large, 
iii,  p.  314,  415;  iv,  30,  68,  185,  231. 

43  For  examples  of  such  inspection  acts  see  South  Carolina  act  of  1746, 
Virginia  act  of  1748  and  North  Carolina  act  of  1746, 

44  Acts  and  Laws  of  His  Majesty's  English  Colony  of  Connecticut,  printed 
1769,  p.  224. 

46  Statutes  at  Large,  iii,  362,  366. 

46  Acts  and  Laws  of  Connecticut  in  New  England  in  America,  1769,  p.  238. 


14  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

New  Jersey  also  found  it  necessary  to  protect  a  limited  supply 
of  ship  timber.  This  was  done  by  imposing  an  export  duty  as  early 
as  1713.  The  act  of  1743  placed  a  duty  of  6d.  per  solid  foot  on  all 
lumber  and  logs  used  for  shipbuilding,  on  masts  Is.  per  square  foot, 
and  on  planks  and  boards  Id.  per  square  foot. 

Some  steps  were  also  taken  by  the  British  government  for  the 
conservation  of  ship  timber  and  the  supply  of  naval  stores.  A 
charter  granted  by  William  and  Mary  to  Massachusetts  in  1691 
contained  a  provision  which  made  it  unlawful  to  cut  pine  trees 
not  on  private  land  which  were  twenty-four  inches  in  diameter, 
twelve  inches  above  the  ground  without  a  license.  The  primary  ob- 
ject of  this  was  to  reserve  them  for  the  royal  navy.  Later  acts  of 
Parliament  embodied  essentially  the  same  restrictions  for  all  the  col- 
onies north  of  Pennsylvania.47  Another  act  imposed  a  penalty  of  £15 
for  felling  pitch,  pine  or  tar  trees  under  a  certain  size.  This  statute 
also  authorized  a  bounty  of  £1  a  ton  on  masts  imported  into  England.48 
This  British  policy  of  protecting  and  developing  a  timber  supply  in 
America  had  little  practical  result  either  in  supplying  the  royal  navy 
or  in  aiding  American  shipbuilding. 

It  did  cause  some  colonial  legislation  along  the  same  lines.  New 
Hampshire  passed  an  act  to  preserve  pitch  pine  trees  for  drawing 
turpentine  in  1719.  The  preamble  to  this  act  declares  that  great 
quantities  of  pitch  pine  trees  are  said  to  have  been  killed  by  being 
cut  and  boxed  on  two  or  three  sides  at  the  same  time.  A  penalty 
of  £5  current  money  is  imposed  for  making  more  than  one  box  on  a 
tree.49  A  few  of  the  other  colonies  passed  similar  laws. 

LEGISLATION  BY  THE   STATES    1776   TO    1789 

During  these  thirteen  years  there  was  very  little  legislation 
which  directly  aided  shipbuilding.  But  a  knowledge  of  the  change 
in  the  general  commercial  policy  in  this  transition  period  is  essential 
to  a  correct  understanding  of  the  attitude  of  the  first  Congress  under 
the  Constitution.  During  the  war  the  commercial  and  maritime  ac- 
tivities of  the  Americans  were  practically  suspended.  Every  state 

47  9  Anne  C.  17,  8  George  I,  C.  12. 

48  3  and  4  Anne  C.  10. 

49  Acts  and  Laws  of  His  Majesty's  Province  of  New  Hampshire,  printed  by 
order  of  the  Governor,  Council  and  Assembly,  authorized  Act  16,  1759,  p.  131. 


GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING  15 

prohibited  trade  with  Great  Britain  under  penalty  of  forfeiture  of 
goods  and  some  states  added  even  more  severe  penalties.  This  leg- 
islation prohibited  what  had  been  by  far  the  most  important  part  of 
American  commerce.  Such  shipping  as  our  merchants  might  have 
carried  on  with  other  countries  was  made  extremely  hazardous  by  the 
British  war-ships  and  privateers.  Hence  shipbuilding  was  at  a  stand- 
still during  the  war. 

After  the  cessation  of  hostilities,  the  first  impulse  was  to  adopt  a 
laissezfaire  policy.  This  was  due,  in  part,  to  the  spirit  of  the  time,  when 
liberty  was  the  watchword.  French  Revolutionary  philosophy,  the 
free  trade  doctrines  of  Quesney  and  Adam  Smith,  and  the  achievement 
of  political  liberty  all  contributed  to  this  spirit.  But,  more  particu- 
larly, the  experience  of  the  Americans  under  the  obnoxious  restric- 
tions of  the  navigation  acts  had  caused  among  them  a  feeling  against 
all  trade  restrictions  and  regulations.  Consequently,  the  states  gave 
no  protection  to  any  American  industries  whatever.  British  goods 
poured  into  the  country  in  such  a  flood  as  to  destroy  the  American 
industries  which  had  sprung  up  during  the  Revolution  and  clogged 
the  markets  so  that  the  country  was  in  a  panic  by  1785.50 

The  treaty  of  peace  said  nothing  about  the  commercial  relations 
which  were  to  obtain  between  the  two  countries.  The  British  navi- 
gation acts  were  still  in  force  and  would  now  operate  against  the 
United  States  as  a  foreign  country.  In  the  same  year  that  peace  was 
made,  Pitt  proposed  to  grant  open  trade  as  to  articles  which  were  the 
produce  of  both  countries;  but  this  measure  failed.51  A  temporary 
act  was  then  passed  vesting  in  the  crown  the  power  of  regulating 
trade  with  America.  This  was  occasionally  exercised  by  suspending 
certain  provisions  under  annual  proclamations.  But  on  the  whole 
American  ships  and  traders  were  treated  as  foreigners  and  conse- 
quently excluded  from  the  West  Indies  trade.  This  was  a  point  of 
vital  importance.  The  sale  of  lumber,  fish  and  other  food-stuffs  fur- 
nished the  Americans  with  their  means  to  buy  the  manufactures  of 
Europe,  particularly  in  England.  The  British  were  so  anxious  to  pre- 
vent the  Americans  from  carrying  on  trade,  that  they  failed  to  see 
how  this  would  affect  their  American  market  and  inflict  injury  on  the 

50  For  a  fuller  account  of  the  general  commercial  policy  of  this  period 
see  Hill,  The  First  Stages  of  the  Tariff  Policy  of  the  United  States,  in  the  Pub- 
lications of  the  American  Economic  Association,  viii,  no.  6,  1893. 

61  Cobbett's  Parliamentary  History  of  England,  xxiii,  640,  724,  762. 


16  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

English  capitalists.  In  the  terrible  sufferings  in  the  West  Indies, 
fifteen  thousand  slaves  are  said  to  have  perished  from  starvation 
between  1780  and  1787. 

The  royal  proclamation  of  July  1783  excluded  American  ships 
from  the  West  Indies  trade.  This  gave  rise  to  the  first  attempts  at 
retaliation.  The  American  statesmen  who  had  advocated  the  laissez 
faire  doctrines  a  few  years  earlier  now  all  declared  in  favor  of  retalia- 
tion, expressing  their  regrets  that  England  clung  to  the  restrictive 
policy.  Newspapers,  town-meetings,  associations  of  merchants  and 
tradesmen  and  legislative  bodies  all  declared  in  favor  of  retaliation. 
This  spirit  of  retaliation,  the  need  for  revenue,  and  the  panic  of  1785 
caused  the  states  to  pass  import  duty  acts  which  contained  an  in- 
increasing  amount  of  protection  to  American  industries,  including 
shipping  and  shipbuilding. 

New  Hampshire  by  the  act  of  1785  ordered  that  the  duty  on 
goods  imported  in  foreign  owned  vessels  should  be  double  that  on 
goods  imported  in  vessels  owned  by  citizens  of  the  United  States. 
An  additional  duty  of  6d.  per  bushel  was  also  imposed  upon  salt  im- 
ported in  vessels  owned  by  English  subjects.  The  act  of  the  next 
year,  1786,  put  a  duty  of  3d.  per  barrel  and  2J  per  cent,  ad  valorem 
on  pitch,  tar  and  turpentine.  Premiums  and  exemptions  from  taxa- 
tion were  also  offered  to  encourage  the  making  of  duck  and  sail-cloth. 

Massachusetts,  under  the  necessity  of  raising  revenue  was  com- 
pelled to  impose  duties  on  imports  in  1782  but  the  preamble  makes 
apologies  by  declaring  that  "all  restrictions  upon  trade  have  been 
found  to  be  highly  injurious  to  those  countries  which  derive  a  great 
part  of  their  wealth  and  strength  from  commerce."  But  the  expe- 
rience of  the  country  with  England  between  1783  and  1785  caused  the 
legislators  to  change  their  views  on  trade  regulation.  The  preamble 
to  the  act  of  1785  imposing  duties  on  exports  declared  in  favor  of 
the  principle  of  protection  to  American  industries  and  the  tariff  act 
of  1786  carries  out  the  principle  more  fully.  This  protection  is  ex- 
tended to  shipping  in  1787  when  a  tonnage  duty  of  2Jd.  per  ton  is 
imposed  on  vessels  except  fishing  and  coasting  vessels  which  pay  only 
5s.  per  year.  A  duty  of  Is.  per  ton  is  put  on  all  vessels  not  wholly 
owned  by  citizens  of  the  United  States.  Three  years  before  this  a 
tonnage  tax  was  enacted  to  provide  funds  for  a  light-house.  All 
ships  belonging  to  inhabitants  of  Massachusetts  or  citizens  of  the 
United  States  were  exempted  from  this  tax.  All  other  vessels  were 


GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING  17 

required  to  pay  4d.  per  ton.  Massachusetts  also  cared  for  her  supply 
of  ship  lumber  in  this  period  by  passing  an  act  on  October  24,  1783, 
which  imposed  heavy  penalties  for  cutting  white  pine  on  public 
land  without  a  license. 

Rhode  Island  adopted  the  policy  of  protection  of  home  indus- 
tries in  1785  and  passed  an  act  very  similar  to  the  Massachusetts 
act  of  the  same  year.  They  also  tried  to  stimulate  the  production 
of  wool,  hemp,  and  flax  by  a  bounty  of  Id.  a  pound  on  good  hemp  and 
flax  produced  in  1787.  They  assigned  as  a  reason  that  it  was,  "To 
encourage  the  growth  of  all  raw  materials,  more  especially  those  that 
supply  clothing  to  the  inhabitants,  and  duck  or  cordage  for  carrying 
on  commerce."52 

Connecticut  gave  her  shipping  interests  a  better  chance  in  1784. 
She  had  ordered  in  1779  that  all  vessels  were  to  be  set  in  the  tax  lists 
at  15s.  per  ton.  In  1784  it  was  provided  that  all  vessels  of  Connec- 
ticut engaged  four  months  in  the  year  in  European,  Asiatic,  or  Afri- 
can trade  were  to  be  exempted  from  this  tax,  although  not  from  duties. 
This  act  was  to  continue  for  six  years.  Connecticut  also  maintained 
a  high  export  duty  on  lumber  in  order  that  she  might  not,  in  after 
years,  be  destitute  of  building  materials.53  The  revenue  act  of  1785 
encouraged  the  growth  of  hemp  by  exempting  the  land  on  which  it 
was  grown  from  taxation  and  further  by  a  tax  of  6s.  per  hundred- 
weight on  all  hemp  and  cordage  imported  from  foreign  countries. 

New  York  adopted  a  tariff  schedule  in  1784  similar  to  the  one 
in  force  in  Massachusetts.  Cordage  was  taxed  whether  made  in  the 
United  States  or  in  Europe.  A  little  later,  it  was  provided  that 
goods  imported  into  New  York  in  British  vessels  should  pay  double 
the  regular  duties.  In  April,  1785,  additional  duties  were  laid  on 
cordage,  ropes,  etc.,  and  the  proceeds  were  to  be  applied  to  a  bounty 
on  hemp.  An  attempt  was  also  made  to  discriminate  more  effectively 
against  British  shipping  by  providing  that  "All  goods,  wares  and 
merchandise  other  than  the  produce  or  manufactures  of  any  of  the 
United  States,  imported  into  this  State,  from  the  States  of  Rhode 
Island,  Connecticut,  New  Jersey  and  Pennsylvania  shall  be  subject 
to  like  duties  as  are  paid  by  goods  imported  in  British  vessels,  unless 
it  be  proved  to  the  satisfaction  of  the  collector  that  such  goods  are 

82  Laws  of  Rhode  Island,  1786.  March  Sess.  7  and  12. 
"  Acts  of  Connecticut,  pp.  784-245. 


18  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

not  imported  into  the  United  States  in  British  vessels."54  In  1785 
New  York  provided  a  bounty  on  hemp  when  this  act  expired  three 
years  later,  the  act  of  March  3,  1788  provided  for  a  bounty  of  8s.  per 
hundred-weight.  This  remained  in  force  till  1792. 

New  Jersey,  also,  passed  an  act  in  1788  authorizing  a  bounty  of 
9d.  per  ton  for  well-dressed  flax  and  4d.  per  pound  for  hemp  raised 
in  the  state.  New  Jersey  and  Delaware  made  no  other  important 
commercial  regulations  but  they  did  pass  acts  empowering  Congress 
to  lay  imposts. 

The  attitude  of  the  Pennsylvania  legislators  at  this  time  is  ex- 
pressed in  the  preamble  of  an  act  passed  March  7,  1784  to  protect 
shipbuilders.  Declaring,  "Whereas  the  business  of  shipbuilding  is  a 
very  important  branch  of  commerce  in  this  State  and  ought  to  re- 
ceive all  proper  encouragement,"  they  provided  that  the  ship  should 
be  liable  to  the  claims  of  those  who  furnished  materials  or  labor  for 
building  or  repairing  it.  The  next  year  they  passed  an  import  duty 
act  which  was  intended  to  protect  domestic  manufactures  and  com- 
merce. Several  earlier  unimportant  acts  had  been  passed  since  the 
war.  That  of  1782  imposing  import  duties  to  be  used  for  the  defense 
of  the  Delaware  River  was  soon  repealed  on  petition  of  the  merchants 
of  Philadelphia  since  they  were  injurious  to  trade.  The  general  pro- 
tective tariff  passed  September  20,  178555  is  of  unusual  importance  be- 
cause, together  with  the  act  of  1787,  it  became  a  model  for  the  first 
Federal  laws  protecting  our  commerce  and  navigation  under  the 
Constitution.  This  act  imposed  considerable  duties  upon  a  long  list 
of  manufactures  among  them  some  produced  by  the  various  branches 
of  the  shipbuilding  industry.  Upon  ready-made  sail,  the  duty  was 
ten  per  cent  ad  valorum;  upon  all  tarred  cordage,  yarn  or  fixed  rigging, 
it  was  8s.  and  4d.  for  every  hundred-weight,  and  upon  white  rope, 
it  was  12s.  and  6d.  To  favor  the  domestic  manufacture  further,  raw 
hemp  and  flax  were  to  be  free  from  all  import  duty.  Ship  carpen- 
ters were  protected  by  a  duty  of  7  J  per  cent  on  all  foreign  made  car- 
penter's work,  blocks  for  shipping,  and  sheaves  for  ship  use.  Ship- 
building would  also  profit  by  the  protection  given  to  the  shipping 
business.  This  was  secured  by  a  tonnage  tax  of  7s.  and  6d.  "for 
every  ton  for  each  and  every  voyage,  belonging  in  whole  or  in  part 
to  any  foreign  country  or  state  except  such  as  had  commercial  trea- 

64  New  York  Laws,  1777  to  1784. 
66  Pennsylvania  Laws,  p.  669. 


GOVEKNMENT  AID   TO  AMERICAN   SHIPBUILDING  19 

ties  with  the  Honorable  Congress  of  the  United  States."  This,  how- 
ever, was  repealed  in  April  1786  because  injurious  to  Pennsylvania 
trade  until  other  states  imposed  similar  duties.  The  duty  on  rum  was 
also  framed  so  as  to  discriminate  against  foreign  ships.  All  rum  im- 
ported in  a  foreign  vessel  was  to  pay  6d.  per  gallon  and  to  prevent 
foreign  ships  from  bringing  it  into  the  state  through  another  state 
and  then  into  Pennsylvania,  the  duty  was  to  apply  to  all  rum  im- 
ported from  another  state  unless  it  had  been  brought  to  that  state 
in  vessels  belonging  to  the  United  States. 

The  act  of  1785  was  amended  by  an  act  passed  March  15,  1787.56 
The  third  section  of  this  act  ordered  that  all  goods  imported  by  any 
foreigner  and  not  consigned  to  citizens  of  this  state  should  pay  an 
additional  impost  of  2  per  cent.  The  ninth  section  provided  for  an 
abatement  of  5  per  cent  on  all  duties  and  imposts  on  goods  im- 
ported in  vessels  built  in  the  state  and  two-thirds  of  which  are  the 
property  of  citizens  of  the  same.  American  ships  were  also  favored 
in  the  direct  trade  to  the  Orient  by  exempting  from  duty  tea  and 
porcelain  brought  direct  in  ships  built  and  owned  in  the  United 
States.  This  act  continued  but  lowered  the  duty  on  tarred  rope  and 
fixed  rigging.  In  1788  a  tonnage  tax  of  Is.  2d.  per  ton  was  imposed 
upon  all  vessels  owned  in  whole  or  in  part  by  persons  not  citizens  of 
the  United  States.  Those  owned  by  citizens  of  the  United  States 
were  required  to  pay  only  7d.  per  ton. 

Maryland  in  1783  imposed  a  tonnage  duty  of  2s.  per  ton  on 
shipping,  but  the  registered  ton  was  altered  so  as  to  favor  her  own 
shipping.  But  later  in  the  year,  in  retaliation  to  the  exclusion  of 
American  vessels  from  the  West  Indies,  the  duty  was  made  5s.  per  ton 
on  British  ships,  and  no  register  was  to  be  granted  to  vessels  owned 
in  whole  or  in  part  by  British  subjects.  In  1785  the  tonnage  tax  was 
fixed  at  6d.  per  ton  on  Maryland  ships  and  Is.  per  ton  on  all  other 
ships.  In  order  to  enjoy  the  privileges  of  Maryland  ships,  it  was  re- 
quired that  at  least  half  the  vessels  be  the  actual  property  of  citizens 
of  the  state.  In  her  customs  act  of  the  previous  year,  1784,  Mary- 
land also  favored  her  own  shipping.  This  act  discriminated  in  both  the 
import  and  export  duties.  The  avowed  purpose  of  the  act67  was  "  to 
encourage  the  building  of  merchant  vessels  within  this  state  and  to 
navigate  them  by  citizens  of  this  or  some  other  of  the  United 

56  Lays  of  Pennsylvania,  1785  to  1787,  p.  245. 

57  Customs  act,  1784,  ch.  84,  sec.  16. 


20  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

States."  To  attain  this  end  substantial  reductions  in  duties  were 
allowed  on  all  goods  imported  in  vessels  built  in  the  state.  These  re- 
ductions amounted  to  one-third  of  the  duty  on  exports  and  from  one- 
eighth  to  one-half  on  imports.  Vessels  entirely  owned  and  navi- 
gated by  citizens  of  the  state  were  to  receive  a  reduction  twice  as 
great  as  others. 

Virginia  passed  a  discriminating  tonnage  tax  in  1783,58  and  two 
years  later  increased  the  tax  on  British  vessels  to  5s.  per  ton.59  She 
also  increased  the  duty  on  goods  imported  in  vessels  owned  wholly 
or  in  part  by  citizens  or  subjects  of  any  country  not  in  commercial 
treaty  with  the  United  States.60  By  another  act  of  178661  foreign 
vessels  were  restricted  to  certain  ports  but  vessels  built  within  the 
United  States  and  owned  by  citizens  thereof  were  allowed  to  land 
anywhere  in  the  commonwealth. 

SUMMARY 

Details  aside,  it  appears  that  shipbuilding  was  established  in  New 
England  by  government  aid  and  encouraged  by  the  government  of 
the  mother  country,  at  first  through  charter  provisions  and  royal 
instructions,  later  by  the  "navigation  acts."  All  the  colonial  govern- 
ments showed  a  desire  to  have  their  own  shipbuilding.  Bounties 
paid  in  those  colonies  where  the  industry  did  not  flourish  failed  to 
establish  it  there.  The  most  common  method  of  encouraging  ship- 
building was  to  grant  discriminating  duties  in  favor  of  vessels  built 
in  the  colony.  These  discriminations  applied  to  the  duties  on  goods 
imported  in  the  ship  and  to  the  tonnage  duties.  After  the  first 
quarter  of  the  eighteenth  century,  these  duties  were  of  little  effect 
because  Great  Britain  refused  to  allow  such  discrimination  against 
her  own  ships,  and  the  ships  of  neighboring  colonies  were  either 
included  in  the  favored  class  or  exempted  under  reciprocity  arrange- 
ments. The  British  "navigation  acts,"  however,  protected  all  the 
colonial  shipbuilding  from  foreign  competition  to  the  end  of  the 
colonial  period. 

The  legislation  for  the  conservation  and  production  of  ship- 
building materials  ennacted  in  practically  all  the  colonies  was  suc- 

68  Hening,  xi,  p.  289. 

69  Hening,  xii,  p.  32. 

60  Hening,  xii,  p.  290. 

61  Hening,  xii,  p.  320. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  21 

cessful  and  important.  The  bounties  paid  for  the  production  of 
hemp  and  flax  were  the  most  common  features  of  this  legislation. 
Throughout  the  colonial  period,  it  was  difficult  to  keep  up  an  ade- 
quate supply  of  these  materials  for  cordage  and  sails.  The  constant 
aid  of  the  colonial  governments  established  their  production.  The 
production  of  tar,  pitch  and  turpentine  soon  became  so  well  established 
as  not  to  need  any  aid  from  the  government.  In  the  establishment 
of  these  industries  auxiliary  to  shipbuilding  the  government  aid  was 
of  considerable  importance. 

Another  feature  of  the  colonial  policy  was  that  of  inspection  by 
officials  authorized  by  the  colonial  legislatures.  They  passed  judg- 
ment upon  naval  stores  and  hemp.  They  were  authorized  to  pre- 
vent rope-makers  from  working  up  inferior  material.  In  several  of 
the  most  important  shipbuilding  colonies,  the  work  of  the  shipwrights 
was  also  subject  to  such  inspection  as  well  as  the  timber  they  used. 


PART  II.    NATIONAL  POLICY  SINCE  1789 

DISCRIMINATING    DUTIES    TO    AID    AMERICAN    SHIPBUILDING 

The  commercial  situation  in  the  American  states  was  directly 
responsible  for  the  creation  of  the  Constitution  and  the  federal  gov- 
ernment established  by  it.  As  soon  as  the  new  government  was 
established,  it  began  its  work  of  relief.  The  shipowners  had  suffered 
severely  during  the  Revolution  and  were  most  directly  affected  by 
the  ruinous  restrictions  of  the  British  after  the  war.  The  intimate 
relation  between  the  prosperity  of  the  merchant  marine  and  the  de- 
mands upon  shipbuilding  had  caused  stagnation  in  the  latter  indus- 
try. The  shipbuilders  began  to  implore  Congress  for  aid  as  soon  as 
it  assembled.  As  early  as  April  13,  1789,  there  was  communicated 
to  Congress  a  petition  from  the  shipwrights  of  South  Carolina62  de- 
ploring the  diminished  state  of  shipbuilding  in  America,  and  the 
ruinous  restrictions  to  which  our  vessels  were  subject  in  foreign  ports, 
and  the  distressed  conditions  of  our  commerce  languishing  under 
most  disgraceful  inequalities,  and  appealing  for  immediate  protec- 
tion and  relief. 

A  few  weeks  later  there  came  from  the  shipwrights  in  Baltimore 
a  petition63  in  which  they  express  their  desire  to  unite  with  their 
bretheren  of  Charleston  in  bringing  this  matter  before  Congress. 
The  memorial  from  the  mechanics  and  manufacturers  of  New  York 
laments  the  failure  of  the  system  of  natural  liberty.64  The  communi- 
cation from  Boston65  speaks  for  the  manufacturers  and  merchants  as 
well  as  for  the  shipbuilders.  It  complains  of  "the  great  decrease 
of  American  manufactures  and  the  almost  total  stagnation  of  Amer- 
ican shipbuilding,"  and  continues  thus:  "Your  petitioners  beg  leave 
to  inform  Congress,  that,  previous  to  the  war,  upwards  of  sixty  ves- 
sels, from  one  hundred  and  fifty  to  three  hundred  tons,  have  been  built, 
in  the  town  of  Boston,  in  the  course  of  one  year;  and  provided  such 
restrictions  were  laid  upon  foreign  vessels  as  to  give  decided  prefer- 

62  American  State  Papers,  Commerce  and  Navigation,  i,  p.  5. 
68  American  State  Papers,  Commerce  and  Navigation,  i,  p.  5. 

64  American  State  Papers,  Finance,  i,  p.  9. 

65  American  State  Papers,  Finance,  i,  p.  10. 

22 


GOVERNMENT  AID   TO  AMERICAN  SHIPBUILDING  23 

ence  to  American-built  ships,  we  apprehend  that  these  States  would 
be  able,  in  a  short  period,  to  supply  a  large  portion,  if  not  the  whole, 
of  the  navigation  necessary  for  the  carrying  trade  of  the  United 
States." 

The  memorial  and  petition  of  the  master  shipwrights  of  Phila- 
delphia66 presents  a  most  interesting  picture  of  the  condition  of  ship- 
building in  that  port  and  may  be  taken  as  an  indication  of  the  general 
situation  throughout  the  other  ports  of  the  country.  It  represents: 
"That  before  the  late  Revolution,  the  shipwrights  of  the  port  of 
Philadelphia  had  acquired  the  reputation  of  building  ships  of  moder- 
ate size,  as  well  and  as  faithfully  as  any  other  port  of  the  world  by 
means  whereof  they  obtained  constant  employment  for  themselves, 
their  journeymen  and  apprentices,  by  shipbuilding  to  the  amount  of 
four  thousand,  five  hundred  tons  annually,  besides  repairs  of  old 
ships.  That  the  Revolution,  in  its  consequences  and  effects  has 
borne  harder  upon  your  petitioners  than  upon  any  other  class  of 
mechanics  (or  perhaps  citizens  at  large)  whatever,  in  depriving  them 
of  two-thirds  of  their  former  employment,  as  it  appears  from  an 
average  of  three  years  past,  that  they  have  built  only  to  the  amount 
of  fifteen  hundred  tons  annually.  That  the  British  "Navigation  Act" 
totally  prevents  them  from  building  ships  for  that  nation,  but  their 
merchants  generally  repair  their  vessels  in  America  as  far  as  that 
act  allows  and  often  run  the  risk  of  forfeiture  by  exceeding  the  lim- 
itation. That  although  the  arret  of  France  of  December  1787  grants 
that  vessels  built  in  the  United  States,  and  sold  in  France  or  pur- 
chased by  Frenchmen  shall  be  exempted  from  all  duties  on  proof 
that  they  were  built  in  the  United  States,  yet  your  petitioner  built 
few  vessels  for  that  nation.  That  an  edict  of  Spain  of  January  1786 
lays  a  heavy  duty  on  America-built  vessels,  purchased  by  their  sub- 
jects; and  also  prohibits  them  trading  to  their  colonies,  although  the 
duty  is  paid,  and  they  are  owned  by  the  subjects  of  Spain;  neverthe- 
less, the  Spaniards  have  purchased  more  vessels  from  your  peti- 
tioners than  any  other  nation.  That  under  these  discouraging  cir- 
cumstances, they  have  waited,  with  anxious  expectations  for  the 
sitting  of  the  honorable  Congress  under  the  Constitution  of  the 
United  States,  firmly  relying  that  every  exertion  would  be  used  to  re- 
instate so  necessary  and  useful  a  branch  of  business  as  nearly  as  pos- 
sible, upon  its  former  flourishing  establishment." 

66  American  State  Papers,  Finance,  i. 


24  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

The  petitioners  then  suggest  the  following  remedies: 

1.  That  a  tonnage  duty  should  be  placed  on  all  foreign-built 
shipping  sufficient  to  give  a  decided  preference  to  shipping  built  in 
the  United  States. 

2.  That  American-built  and  owned  shipping  should  be  exempt 
from  this  tonnage  tax. 

3.  That  American-built  ships  purchased  by  foreigners,  ought  to 
be  nearly  on  the  same  footing  as  if  owned  by  American  merchants. 

4.  That  foreign-built  ships  purchased  by  Americans  should  pay 
the  same  tax  as  foreign-built  vessels  owned  by  foreigners. 

5.  That  discriminating  duties  be  imposed  on  goods  imported, 
those  imported  in  American-built  ships  to  pay  less  than  those  im- 
ported in  foreign  ships. 

6.  That  discriminating  duties  should  favor  direct  trade  with 
foreign  counties  in  American-built  vessels. 

7.  That  reciprocity  respecting  American-built  ships  might  be 
arranged  with  Spain  and  Great  Britain. 

8.  That  no  high  duties  should  be  laid  on  materials  necessary  for 
fitting  ships  which  would  augment  their  price  and  retard  the  progress 
of  shipbuilding. 

9.  That  a  general  system  for  the  measurement  of  all  ships  built 
in  the  United  States  be  established. 

In  response  to  these  petitions  Congress  soon  passed  several  laws 
which  gave  the  desired  relief.  These  acts  dealt  primarily  with  rev- 
enue and  shipping,  but  the  debates  in  Congress  show  that  it  was  also 
the  intention  to  give  protection  to  shipbuilding.  The  sentiment  of 
Congress  is  expressed  by  Mr.  Fitzsimmons,  of  Pennsylvania,  speak- 
ing in  support  of  the  discriminating  tonnage  act  when  he  says,  "The 
business  of  shipbuilding,  I  conceive,  stands  at  this  moment  in  want 
of  the  greatest  encouragement  in  our  power  to  give.  If  sufficient 
encouragement  is  given  at  this  time,  to  produce  a  quantity  of  ship- 
ping adequate  to  the  demand,  when  once  in  possession  of  them  the 
business  will  stand  in  need  of  no  further  encouragement."67 

The  first  method  by  which  the  government  gave  aid  to  ship- 
building was  by  imposing  discriminating  duties.  This  policy  was  car- 
ried out  in  two  acts,  the  one,  the  act  of  July  4,  1789,  placing  discrimi- 
nating duties  on  imports,  the  other  the  tonnage  act  of  July  20, 
1789.68  The  former  act  provided  in  section  5  "That  a  discount  on  all 

67  Benton's  Debates  of  Congress,  i,  p.  54. 
88 1  Cong.,  sess.  1,  ch.  2,  and  3. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  25 

duties  imposed  by  this  act,  shall  be  allowed  on  all  such  goods,  wares, 
and  merchandise  as  shall  be  imported  in  vessels  built  in  the  United 
States  and  which  shall  be  wholly  the  property  of  a  citizen  or  citizens 
thereof."  At  its  second  session  the  first  Congress  made  further  pro- 
vision for  the  payment  of  the  debts  of  the  United  States  by  adopting 
a  new  tariff  schedule.  This  act  of  August  10,  1790  continued  the 
principle  of  discriminating  duties  but  changed  the  method.  Instead 
of  10  per  cent  discount  on  duties  for  goods  imported  in  American 
ships,  10  per  cent  was  added  to  the  duties  when  the  goods  were  im- 
ported in  foreign  vessels.69  The  tariff  act  of  May  179270  and  the 
act  of  179471  contained  the  same  provision. 

The  second  of  our  fundamental  maritime  laws  protected  Amer- 
ican-built ships  by  a  discriminating  tonnage  duty.  This  act  allowed 
American-built  ships  owned  by  American  citizens  to  enter  our  ports 
by  paying  a  tonnage  tax  of  only  6  cents  per  ton,  while  it  imposed  a 
similar  tax  of  50  cents  per  ton  on  vessels  built  and  owned  by  for- 
eigners. Foreigners  were  encouraged  to  buy  American-built  ships  by 
the  provision  that  ships  built  in  the  United  States  and  belonging  to 
foreigners  should  pay  at  the  rate  30  cents  a  ton.  The  act  also  pro- 
vided that  ships  built  and  owned  in  the  United  States  engaged  in  the 
coasting  trade  or  in  fishing  should  pay  this  tonnage  tax  only  once  a 
year  while  foreign  ships  in  this  trade  should  pay  it  at  every  entry. 
By  another  act72  Congress  gave  American-built  ships  a  practical 
monopoly  of  the  trade  with  the  Orient.  It  provided  that  teas  brought 
direct  from  China  in  ships  of  the  United  States  were  to  pay  only 
about  two-thirds  as  much  duty  as  when  imported  in  foreign  ships. 
Even  when  they  were  brought  from  Europe  in  domestic  ships  they 
were  admitted  on  a  much  lower  duty  than  when  brought  in  foreign 
vessels. 

By  the  act  of  March  27,  1804,73  "light  money"  at  the  rate  of 
50  cents  per  ton  was  levied  upon  all  foreign  ships.  This  had  the 
practical  effect  of  increasing  the  discrimination  in  the  tonnage  tax. 
All  foreign  built  vessels  now  had  to  pay  $1  a  ton  at  each  entry,  Amer- 
ican ships  paid  only  6  cents. 

69 1  Cong.,  sess.  2,  ch.  39,  sec.  2. 

70  2  Cong.,  sess.  1,  ch.  27,  sec.  5. 

71  3  Cong.,  sess.  1,  ch.  54,  sec.  4. 
72 1  Cong.,  sess,  2,  ch.  39,  sec.  1. 
78  8  Cong.,  sess.  1,  ch.  57,  sec.  6. 


26  GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING 

The  discriminating  taxes  aided  our  shipbuilding  not  only  directly 
but  also  indirectly  by  increasing  our  shipping  and  thereby  creating 
a  demand  upon  our  shipyards  for  merchant  ships.  The  policy  of 
discriminating  in  favor  of  American  ships  in  import  duties  and  ton- 
nage taxes  was  continued  from  1789  until  it  was  superseded  by  the 
policy  of  commercial  reciprocity.  This  was  put  in  force  by  a  series 
of  proclamations  issued  by  the  President  of  the  United  States  under 
the  act  of  181574  which  opened  our  direct  trade  to  reciprocity  and 
the  act  of  182875  which  opened  the  indirect  trade  as  well.  Since  this 
policy  has  gone  into  effect  American  built  ships  enjoy  no  special 
favors  in  the  foreign  trade. 

AMERICAN  REGISTRY 

In  order  to  make  sure  that  the  American  shipbuilders  would  get 
the  benefit  of  the  protection  intended  by  the  discrimination  in  favor 
of  ships  built  in  the  United  States  it  was  necessary  for  the  govern- 
ment to  keep  a  record  of  all  the  ships  built  in  this  country  and  to  dis- 
tinguish between  those  owned  by  Americans  and  those  owned  by 
foreigners.  The  American  registry  act  of  September  1,  1789,  makes 
provision  for  this.76  Section  1  provides  "That  any  ship  or  vessel 
built  within  the  United  States,  and  belonging  wholly  to  a  citizen  or 
citizens  thereof,  or  not  built  within  said  states,  but  on  the  sixteenth 
day  of  May,  one  thousand  seven  hundred  and  eighty  nine,  belonging, 
and  thereafter  continuing  to  belong,  wholly  to  a  citizen  or  citizens 
thereof,  and  of  which  the  master  is  a  citizen  of  the  United  States, 
and  no  other,  may  be  registered  in  manner  hereafter  provided,  and 
being  so  registered  shall  be  deemed  and  taken  to  be,  and  denominated 
a  ship  or  vessel  of  the  United  States  and  entitled  to  the  benefits 
granted  by  any  law  of  the  United  States  to  ships  or  vessels  of  the 
description  aforesaid." 

The  act  provides  a  form  for  a  certificate  of  registry  to  be  secured 
from  the  collector  of  the  district  to  which  the  vessel  belongs.  A  full 
description  of  the  vessel  is  set  forth  in  the  certificate.  This  certificate 
is  to  be  attested  by  the  secretary  of  the  treasury  under  his  hand  and 
seal  and  countersigned  by  the  collector.  A  duplicate  of  every  certificate 

74 13  Cong.,  sess.  3,  ch.  77. 
75  20  Cong.,  sess.  1,  ch.  111. 
76 1  Cong.,  sess.  1,  ch.  11. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  27 

granted  is  kept  by  the  government.  All  vessels  of  twenty  tons  or  up- 
wards engaged  in  fishing  or  in  the  coasting  trade  are  to  be  enrolled  in  a 
similar  way.  Rules  for  tonnage  measurement  are  laid  down  in  the  act. 
It  also  requires  that  all  vessels  built  in  the  United  States  but  owned 
by  foreigners  "shall  be  recorded  in  the  office  of  the  collector  of  the 
district  in  which  the  ship  was  built."  The  builder  is  required  to  make 
oath  as  to  the  description.  Although  this  act  was  carefully  drawn, 
foreigners  soon  found  defects  in  the  law  through  which  they  could 
enjoy  the  lower  tonnage  and  import  duties  allowed  only  to  American- 
built  ships.  It  was  also  found  that  the  law  was  not  explicit  enough 
to  prevent  evasion  by  which  foreign-built  vessels  secured  American 
registry.  Hence  to  protect  American  shipbuilders  more  securely  a  more 
detailed  law  carrying  out  the  intent  of  the  original  registry  act,  was 
enacted  December  3,  1792.77  The  act  of  February  18,  179378  pro- 
vided still  further  details  in  supplementing  the  earlier  legislation  to 
carry  out  the  principles  of  complete  protection  to  American  ship- 
builders by  granting  American  registry  exclusively  to  ships  built  in 
this  country. 

Fortunately  for  American  shipbuilding  Congress  has  adhered  to 
this  policy  down  to  the  present  tune.  The  only  modification  (ex- 
cept vessels  captured  in  war)  of  the  present  principle  is  that  involved 
in  an  act  of  December  23, 185279  which  permits  foreign  vessels  wrecked 
in  the  waters  of  the  United  States  and  repaired  in  our  ports  to  take 
out  American  registers  if  the  repairs  amount  to  three-fourths  of  the 
value  of  the  vessel.  This  act  was  repealed  February  26,  1906. 80 
American  registry  and  its  primary  principle  of  American  ships  built 
in  American  yards  are  the  legal  basis  which  have  enabled  our  ship- 
builders to  reap  the  benefits  of  all  other  legislation  intended  to  en- 
courage American  shipbuilding  or  shipping. 

BOUNTIES   FOR  THE   FISHERIES 

From  earliest  colonial  tunes  the  fisheries  made  large  demands 
upon  our  shipbuilders  directly  for  fishing  vessels  and  indirectly  for 
merchant  vessels.  Fully  aware  of  the  importance  of  the  fisheries  to 
our  commercial  welfare,  the  fathers  of  the  Republic,  early  in  our 

77  2  Cong.,  sess.  1   ch.  1. 

78  2  Cong.,  sess.  2,  ch.  8. 

79  32  Cong.,  sess.  2,  ch.  4. 

80  49  Cong.,  sess.  1,  ch.  500. 


28  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

national  history,  began  the  practice  of  paying  what  were  practically 
bounties  for  vessels  engaged  in  the  deep  sea  fisheries.  Acting  upon 
Jefferson's  report,  Congress  passed  the  act  of  February  16, 1792,  which 
provided  that  in  lieu  of  the  drawback  of  duties  paid  on  salt  which 
had  previously  been  allowed  on  dried  fish  exported,  there  were  to  be 
paid  bounties.  We  may  fairly  call  these  payments  bounties  for  the 
payments  authorized  were  much  larger  than  the  duty  on  salt.  Ships 
below  twenty  tons  were  to  receive  $1.60  a  ton,  those  between  twenty 
and  thirty  tons  were  to  receive  $2.40  a  ton,  and  those  over  thirty 
tons  were  to  be  paid  at  the  rate  of  $4  a  ton.  On  January  1,  1798, 
these  rates  were  increased  by  a  third. 

The  War  of  1812  interrupted  this  practice,  but  the  act  of  181381 
restored  the  bounties  at  the  original  rates.  With  some  modifications, 
the  policy  of  paying  fishing  bounties  was  continued  under  all  changes 
of  parties  until  1866.82 

There  may  have  been  no  direct  intention  to  aid  shipbuilding 
through  these  bounties  yet  that  industry  did  derive  a  very  consid- 
erable benefit  from  these  payments,  and  the  lawmakers  were  fully 
aware  of  the  relation  between  the  fisheries  and  the  welfare  of  our 
other  maritime  industries.  Those  who  favor  bounties  to  aid  our 
shipping  and  shipbuilding  find  a  satisfactory  precedent  in  these  fish- 
ing bounties. 

THE  COASTING  RESTRICTION   IN  THE  NAVIGATION  ACT   OF   1817 

The  tonnage  act  of  1789  required  that  American-built  ships 
owned  by  Americans  should  pay  a  tax  of  6  cents  a  ton,  only  once  a 
year,  while  it  required  50  cents  a  ton  on  ships  built  and  owned  by  for- 
eigners to  be  paid  every  time  they  entered  an  American  port.  This 
was  virtually  a  prohibitive  tax  as  it  was  intended  to  be.  The  "light 
money"  at  50  cents  a  ton  imposed  on  foreign  vessels  increased  the 
discrimination  and  operated  to  the  same  effect.  However,  the  act 
of  Congress  of  April  5,  1808,  supplementing  the  embargo  act  placed 
an  absolute  prohibition  upon  all  foreign  vessels  in  our  coastwise  trade. 
The  next  year  this  prohibition  was  removed  but  the  American  ship 
continued  to  be  effectually  protected  by  the  discriminating  tonnage 
taxes.  But  the  navigation  act  passed  in  181 783  places  an  absolute 

81  30  Cong.,  sess.  1,  ch.  35. 

82  39  Cong.,  sess.  1,  ch.  298,  sec.  4. 
83 14  Cong.,  sess.  2,  ch.  31. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  29 

prohibition  upon  all  foreign  vessels  in  our  coastwise,  lake,  and  river 
shipping.  Section  four  of  this  act  provides  "that  no  goods,  wares 
or  merchandise  shall  be  imported  under  penalty  of  forfeiture,  from 
one  port  of  the  United  States  to  another  port  of  the  United  States 
in  vessels  belonging  wholly  or  in  part  to  a  subject  of  any  foreign 
power." 

Since  only  American-built  vessels  can  be  enrolled  for  this  trade, 
our  shipbuilding  industry  has  not  only  drawn  its  living  from  this 
branch  of  navigation  since  the  decline  of  our  foreign  shipping,  but  has 
really  thrived  well.  For  in  spite  of  the  fact  that  the  American-built 
ship  is  being  driven  out  of  all  international  commerce,  this  country 
continues  to  be  one  of  the  foremost  shipbuilding  countries.  The 
thousands  of  miles  of  coast  along  the  Atlantic,  the  Gulf  and  the  Pacific 
in  addition  to  the  Great  Lakes  and  several  more  thousands  of  miles 
of  inland  waterways  afford  the  United  States  an  opportunity  for  mar- 
itime development  from  which  foreigners  have  been  excluded  with- 
out fear  of  retaliation.  No  other  nation  has  such  an  important 
coastwise  commerce.  How  much  of  our  merchant  shipbuilding  is 
dependent  upon  this  law  appears  from  the  fact  that,  in  1909,  the 
total  tonnage  of  our  documented  merchant  marine  was  7,388,755  tons, 
and  of  this  amount  only  887,505  tons  were  registered  for  the  foreign 
trade.84  Besides  this  there  was  an  undocumented  tonnage  of  more 
than  7.000,000  tons  made  up  of  vessels  with  no  motive  power  of  their 
own,  engaged  in  the  trade  protected  by  this  act.85 

Indeed,  it  is  due  to  the  policy  embodied  in  this  act  and  to  our 
recent  naval  policy  that  this  country  possesses  shipbuilding  estab- 
lishments of  such  efficiency,  that  it  is  one  of  the  great  shipbuilding 
nations  of  the  world.  American  shipbuilding  reached  its  height  as 
compared  with  other  nations  in  the  decade  between  1850  and  1860. 
In  those  census  years  the  capital  invested  in  the  industry  was  less  than 
$6,000,000,  an  amount  less  than  half  that  invested  in  each  of  several 
of  our  largest  plants  today.  The  tonnage  built  in  those  census  years 
was,  however,  not  nearly  so  large  as  in  1855  the  year  of  maximum  pro- 
duction when  583,450  tons  were  built.  This  record  has  been  sur- 
passed only  in  1908  when  614,216  tons  were  built.  Although  the 
shipbuilding  industry  has  not  kept  pace  with  the  progress  of  our  other 
industries,  it  has  turned  out  a  greater  tonnage  in  the  last  decade 

84  Report  of  Commissioner  of  Navigation,  1909,  p.  298. 

86  Census  Bulletin  No.  91,  Transportation  by  Water,  1906  p.  9. 


30 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 


than  was  built  in  any  previous  decade.  The  value  of  this  product 
is  very  much  greater;  and  the  amount  of  capital  and  labor  employed 
are  also  very  much  larger. 

One  part  of  the  shipbuilding  industry  of  the  United  States  devel- 
oped under  the  protection  of  the  act  of  1817  deserves  special  atten- 
tion. The  development  of  an  immense  traffic  in  iron  ore,  coal,  lum- 
ber and  grain  on  the  Great  Lakes  has  created  a  demand  for  ships 
that  has  led  to  the  establishment  of  a  very  important  shipbuilding 
industry  in  that  region.  The  steel  shipyards  here  are  favorably  sit- 
uated for  fuel  and  materials,  and  on  account  of  this  act,  are  unham- 
pered by  foreign  competition.  They  have  been  supplying  a  constantly 
growing  demand  for  large  carriers. 

The  relative  importance  of  the  shipbuilding  on  the  Great  Lakes 
for  the  last  few  years  is  shown  by  figures  from  the  report  of  the  com- 
missioner of  navigation  for  1909  making  a  comparison  based  on 
vessels  of  one  thousand  gross  tons  and  over,  built  from  1905  to  1909.86 


1905 

1906 

1907 

1908 

1909 

Total  tonnage  built  on  the 
seaboard  

92786 

41  355 

133  850 

121  555 

32042 

Total  tonnage  built  on  Great 
Lakes  

101,521 

232,366 

217  755 

322806 

85  457 

Grand  total  for  United  States 

194,307 

273,721 

351,605 

444,361 

117,499 

In  1910,  there  were  built  on  the  Great  Lakes  142,521  tons  out 
of  a  total  of  234,706  tons.87 


GOVERNMENT  AID  IN  ESTABLISHING  STEAMSHIP  BUILDING 

Under  the  protection  of  the  laws  enacted  by  Congress  early  in 
our  national  existence,  our  navigation  and  shipbuilding  industries 
became  established  so  securely  that  after  two  generations  of  steady 
growth  the  United  States  ranked  as  one  of  the  two  greatest  maritime 
nations  in  the  world.  In  the  building  of  vessels  this  country  had, 
for  a  time,  better  advantages  than  any  other.  An  abundance  of 
unexcelled  ship  timber,  ample  supplies  of  all  other  materials  necessary 
for  the  construction  and  equipment  of  wooden  vessels,  and  an  ade- 

86  Page  13. 

87  Report  of  the  Commissioner  of  Navigation,  1910,  p.  12. 


GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING  31 

quate  number  of  skilled  shipcarpenters  enabled  American  builders 
to  launch  the  swiftest  and  most  efficient  ships  in  the  world.  More- 
over they  could  build  them  cheaper.  Between  1817  and  1845  there 
was  no  legislation  in  the  United  States  to  aid  shipbuilding  because  none 
was  needed.  American-built  packets  and  clippers  proved  their  supe- 
riority in  competition  for  the  world's  carrying  trade  and  this  created 
a  constant  demand  on  our  ship  yards  from  foreign  as  well  as  Ameri- 
can owners. 

In  the  building  of  steamships,  however,  American  builders  lagged 
behind.  The  superiority  of  the  "  clipper"  caused  American  shipown- 
ers to  delay  in  adopting  steam  for  ocean  navigation.  Great  Britain 
preceded  the  United  States  by  more  than  a  decade  in  the  introduction 
of  trans-Atlantic  steamships.  The  liberal  subsidies  granted  by  Par- 
liament to  the  Cunard  Company  since  1839  had  already  established 
that  company  in  a  regular  steamship  service  across  the  Atlantic,  when 
President  Tyler  in  several  successive  messages  urged  Congress  to 
adopt  a  similar  policy. 

Congress  responded  to  these  recommendations  by  passing  the  act 
of  March  3,  1845. 88  This  act  authorized  the  postmaster-general  to 
make  contracts  with  Americans  for  the  transportation  of  United 
States  mail  between  any  of  the  ports  of  the  United  States  and  a  port 
or  ports  of  any  foreign  power,  "  whenever  in  his  opinion,  the  public 
interest  will  thereby  be  promoted."  Preference  was  to  be  given  to 
steamships  which  were  to  be  delivered  to  the  United  States  at  an 
appraised  value  when  they  might  be  needed  for  naval  purposes.  Con- 
tracts might  also  be  made  for  carrying  the  mails  by  steamers  on  the 
sea  from  one  place  to  another  in  the  United  States.  No  contract 
was  made  until  February  2,  1847, 89  when  the  Ocean  Steam  Naviga- 
tion Company  agreed  to  furnish  a  service  of  six  round  trips  a  year 
between  New  York  and  Bremen  and  six  between  New  York  and  Havre. 
For  this  service  the  government  was  to  pay  $175,000.  The  pay  was 
to  be  doubled,  when  the  service  should  be  doubled.  In  fulfillment  of 
this  contract,  four  large  steamers  were  built.  The  Washington  of 
1640  tons  was  the  first  to  be  finished  and  commenced  service  on 
June  1,  1847.  The  following  March  the  Hermann  of  1734  tons  left 
New  York  on  the  first  trip  to  Bremen.  Two  larger  steamers  the 

88  28  Cong.,  sess.  2,  ch.  69. 

89  House  Exec.  Doc.,  30  Cong.,  sess.  1,  No.  50. 


32  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

Franklin  of  2184  tons  and  the  Humboldt  of  2181  tons  were  completed 
by  1851.     The  next  year,  the  contract  was  extended  till  1857. 

Meanwhile  our  growing  interest  in  the  Pacific  Coast  territories 
of  California  and  Oregon  and  the  consequent  importance  of  the 
Isthmus  of  Panama  route  as  well  as  the  offer  made  by  Mr.  Edward 
K  Collins  of  New  York  for  a  mail  service  between  New  York  and 
Liverpool  caused  Congress  to  pass  the  act  of  March  3,  1847, 90  which 
provided  for  increased  mail  subsidies  and  authorized  contracts  for  the 
construction  of  four  large  war  steamers  also  five  merchant  steamers 
to  carry  the  mails  to  Havana  and  the  Isthmus  of  Panama  and  on  the 
Pacific  from  Panama  to  Oregon  as  well  as  steamers  for  the  trans-Atlan- 
tic mail  service  between  New  York  and  Liverpool. 

This  act  had  important  results  in  American  shipbuilding.  Under 
the  authority  of  the  fourth  section  of  this  act  of  March  3,  1847  the 
secretary  of  the  navy  entered  into  a  contract  with  Mr.  Albert  G. 
Sloo91  for  a  semi-monthly  mail  service  between  New  York,  Charles- 
ton, Havana,  New  Orleans,  and  Chagres  on  the  Isthmus  of  Panama. 
Under  this  contract  Mr.  Sloo  was  to  build  at  least  five  steamships  of 
which  four  were  to  be  not  less  than  1500  tons  each,  propelled  by  en- 
gines of  not  less  than  a  thousand  horse-power  each.92  Under  au- 
thority of  the  fifth  section  of  the  same  act  the  secretary  of  the  navy 
entered  into  a  contract  for  a  monthly  mail  service  from  Panama  to 
Oregon  for  a  term  of  ten  years.  For  this  service,  Mr.  Arnold  Harris 
whose  contract  was  soon  taken  by  Mr.  Wm.  H.  Aspinwall  and  later 
by  the  Pacific  Mail  Steamship  Company,  was  to  furnish  at  least  three 
steamers  of  not  less  than  1000  tons  each.  All  these  steamers  were  to 
be  so  constructed  as  to  be  easily  convertible  into  war  steamers  and 
the  navy  department  was  to  exercise  control  over  them  at  all  times. 
Within  a  year  there  were  built  at  New  York  three  steamers  for  this 
service  on  the  Pacific  Coast.  The  California  was  1050  tons,  the 
Panama  1087  tons,  and  the  Oregon  1099  tons.  For  the  service  from 
New  York  to  the  West  Indies  and  the  Isthmus  of  Panama,  the 
Georgia  and  the  Ohio  were  the  first  to  be  put  into  service.  They  had 
a  tonnage  of  2727  and  2432  respectively  and  were  about  250  feet  long. 
The  Illinois  of  2123  tons  and  267J  feet  in  length  soon  followed  them. 
This  service  from  New  York  and  New  Orleans  to  the  Isthmus  of  Pan- 

90  29  Cong.,  sess.  2,  ch.  62. 

91  Later  assigned  to  George  Law  and  his  associates. 

92  32  Cong.  sess.  1,  House  Exec.  Doc.  No.  124,  p.  67. 


GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING  33 

ama  and  up  the  Pacific  coast  to  California  and  Oregon  wi  begun 
at  a  very  opportune  time.  When  the  pioneer  steamer  of  th~  Pacific 
Mail  arrived  at  Panama  after  rounding  Cape  Horn  from  New  York  the 
captain  was  surprised  to  find  there  an  excited  crowd  waiting  to  be 
taken  to  California.  For  the  news  of  the  discovery  of  gold  there, 
had  reached  them  while  he  was  on  his  way  from  New  York.  An  im- 
mense amount  of  business  immediately  sprang  up.  A  railroad  was 
built  across  the  Isthmus  of  Panama  and  steamer  after  steamer  was 
added  to  meet  the  demand  for  transportation.  In  the  course  of  the 
next  decade  twenty-nine  steamers  of  38,000  tons  were  built  for  these 
two  lines  in  the  Pacific  route  to  California  at  a  cost  of  $8,300,000. 

The  United  States  government,  at  first,  agreed  to  pay  $290,000 
per  annum,  under  the  Sloo  contract  and  $199,000  a  year  for  the  Pacific 
service.  Later  the  payments  were  increased.  The  Pacific  mail  steam- 
ers from  Panama  to  Astoria  received  $308,000  in  1850,  and  $346,000 
after  1855. 

The  contract  which  called  forth  the  finest  steamships  yet  built 
in  this  country  was  that  with  the  Collins  company  for  a  mail  service 
between  New  York  and  Liverpool.93  Mr.  E.  K.  Collins  entered  into 
this  with  the  avowed  purpose  of  producing  a  line  of  steamships  which 
would  excel  the  Cunarders  and  reestablish  the  superiority  of  the 
ships  built  in  the  United  States. 

The  contract  required  the  company  to  build  five  steamships  of 
at  least  2000  tons  each,  and  having  engines  of  1000  horse  power  each. 
The  ships  built  went  far  beyond  this.  The  Artie  was  2856  tons 
the  Atlantic,  2845  tons;  the  Baltic  2723  tons,  and  the  Pacific,  2707 
tons.  The  fifth  ship  called  for  by  the  contract  was  not  finished 
until  1855.  This  was  the  Adriatic  the  largest,  swiftest  and  most 
luxurious  of  all,  having  cost  more  then  $1,000,000.  She  was  345 
feet  in  length  and  had  a  tonnage  of  4144.  These  ships  including  their 
machinery  were  all  built  in  New  York.94 

Under  the  warship  provision  the  Susquehanna,  the  Powhatan, 
the  Saranac  and  the  San  Jacinto  were  built.  The  building  of  these 

93  32  Cong.,  sess.  1,  House  Exec.  Doc.  No.  124,  p.  75. 

94  For  a  detailed  description  of  all  these  subsidized  ships  see  Shipbuild- 
ing Industry  in  the  United  States,  by  Henry  Hall  in  U.  S.  Census  1880,  vol  viii. 
For  full  reports  on  all  the  contracts  and  subsidized  steamers  of  the  United 
States  see  House  Exec.  Doc.  No.  124  (222  par<^s)  and  No.  127  of  32  Cong., 
sess.  1. 


34  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

four  side-wheel  steamers  marks  the  real  beginning  of  our  steam  navy. 
There  had,  however,  been  a  few  steamships  constructed  for  the  navy 
before  this.  Under  the  act  of  1816,  the  first  steam  vessel  of  the 
navy  was  built  and  for  a  long  time  the  Fulton  was  the  only  steamer 
in  the  navy.  The  only  important  steamships  built  for  the  navy  be- 
fore 1847  were  the  Mississippi  and  the  Missouri  in  1839.  But  the 
government  continued  to  favor  sailing  vessels.  Even  as  late  as  1846, 
there  were  authorized  a  number  of  sailing  vessels  including  the  Sar- 
atoga, the  Portsmouth,  and  the  Jamestown.  The  five  steamers  built 
under  the  act  of  1847  represent  the  most  advanced  naval  architecture 
of  the  period,  and  henceforth  sailing  vessels  were  no  longer  constructed 
for  the  navy.  There  was  considerable  delay  in  building  these  steam- 
ers because  of  the  lack  of  experience  in  building  marine  engines.  The 
plants  for  this  purpose  became  established  in  doing  the  work  under 
these  government  contracts. 

As  a  direct  result  of  the  legislation  of  1845  and  1847,  New  York 
City  became  the  greatest  steamship  building  center  in  the  United 
States.  Yards  for  building  sailing  vessels  were  scattered  along  the 
Atlantic  coast,  but  to  build  steamships  and  equip  them  with  suitable 
machinery  required  an  expensive  plant  and  a  body  of  skilled  work- 
men that  must  accumulate  through  large  scale  production.  Con- 
sequently steamship  building  centered  in  a  few  important  places. 
Nearly  all  these  subsidized  steamers  were  built  in  yards  along  the 
East  River  at  New  York. 

"The  work  of  the  New  York  builders  gave  them  a  great  reputa- 
tion and  they  were  able  to  obtain  large  and  profitable  orders  for  war 
steamers  from  Russia,  France,  Italy,  Portugal,  Turkey  and  other 
foreign  governments,  bringing  millions  of  money  to  that  city  .  . 
.  Taking  the  whole  period  from  1830  to  1861  there  were  built 
in  the  four  principal  cities  of  the  Atlantic  coast  about  eighty  sea 
going  steamers  for  coasting  and  California  trades  and  on  foreign 
orders,  aggregating  120,000  tons  in  register  and  costing  about  $29,- 
000,000.  Five-sixths  of  this  tonnage  was  produced  at  New  York 
City."95 

On  account  of  the  failure  of  the  Collins  steamers  to  sail  with 
the  mails  as  frequently  as  was  provided  in  the  contract,  and  a  grow- 
ing suspicion  that  the  company  was  extravagantly  managed,  and 

95  Henry  Hall  in  Census  1880,  vol.  viii. 


GOVERNMENT  AID   TO  AMERICAN   SHIPBUILDING  35 

still  more  on  account  of  the  rising  of  the  sectional  feeling  between 
the  North  and  South,  all  subsidies  were  withdrawn  by  Congress  in 

1858. 96 

NAVAL  DEMANDS   OF  THE   CIVIL  WAR 

The  withdrawal  of  the  subsidies  by  Congress  came  at  a  critical 
period  in  the  history  of  American  shipbuilding — at  the  time  of  the 
transition  from  sail  to  steam  and  from  wood  to  iron.  In  this  tran- 
sition Americans  were  at  a  disadvantage  for  they  owed  their  suprem- 
acy in  shipbuilding  to  the  advantages  they  had  in  building  their 
splendidly  designed  clipper,  and  other  sailing  vessels,  from  the  un- 
surpassed supply  of  first  class  ship  timber.  The  British,  their  great- 
est rivals,  had  the  advantage  in  building  iron  ships,  for  the  Ameri- 
can iron  and  steel  industries  had  hardly  yet  begun  their  great 
development. 

American  shipbuilders  had  to  compete  not  only  with  the  natural 
advantages  which  their  rivals  possessed;  but  their  foreign  competi- 
tors were  also  liberally  subsidized  by  their  governments.  In  order 
to  find  cargoes  to  carry,  our  ship  owners  had  to  lower  freight  rates  till 
profits  vanished,  and  even  then  many  ships  were  idle.  Just  as  these 
adverse  conditions  were  beginning  to  drive  the  American  merchant 
marine  from  its  supremacy,  the  Civil  War  came  bringing  with  it  the 
ravages  of  the  Confederate  cruisers,  increased  insurance,  and  ruinous 
taxation.  These  bore  down  so  heavily  upon  our  shipping  that  our 
registered  tonnage  declined  from  2,642,628  tons  in  1861  to  1,492,926 
tons  five  years  later,  and  the  proportion  of  our  foreign  trade  carried 
in  domestic  bottoms  declined  from  65.2  per  cent  in  the  first  year  of 
the  war  to  27.7  per  cent  in  the  last  year  of  the  war.  This  loss  was 
not  due  mainly  to  captures  and  losses  at  sea,  but  to  the  fact  that 
American  ship  owners  either  sold  their  vessels  to  their  competitors 
or  placed  them  under  the  protection  of  a  foreign  flag.  Nearly  800,000 
tons  passed  from  American  register  to  foreign  powers.  It  is  obvious 
that  these  were  bad  times  for  our  merchant  shipbuilding;  but,  while 
the  war  brought  with  it  these  disadvantages  to  shipbuilding,  it  also 
created  a  demand  for  war  vessels  and  forced  under  stress  of  the  war 
a  development  in  skill  and  building  equipment  which  would  not  have 

96  Act  June  14, 1858;  35  Cong.,  sess.  1,  ch.  164.  For  a  more  complete  study 
of  these  subsidies  see  History  of  Shipping  Subsidies,  by  Royal  Meeker,  in 
American  Economic  Association  Publications,  3  series,  vol.  vi. 


36  GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 

been  developed  in  so  short  a  time  under  ordinary  conditions  of  peace. 
When  the  war  broke  out  the  navy  contained  only  thirty  steamships 
and  some  antiquated  sailing  vessels.  Only  forty-two  vessels  were  in 
commission.  A  whole  navy  had  to  be  created  and  for  this  task 
the  government  depended  largely  on  the  private  shipyard  and 
employed  the  shipbuilders  who  had  been  producing  our  merchant 
vessels. 

The  government  was  compelled  to  have  much  of  this  work  done 
in  private  yards.  The  navy  yards  had  been  sadly  neglected  for 
years  and  were  hopelessly  inadequate  to  the  needs  of  the  war,  even 
the  well-equipped  private  establishments  could  not  turn  out  the 
work  as  quickly  as  it  was  desired.  Anyhow  it  had  heretofore  always 
been  the  policy  of  the  government  to  patronize  private  establish- 
ments liberally  with  its  orders  for  the  navy.  As  the  war  progressed, 
the  government  seems  to  have  been  well  pleased  with  the  work  done 
by  the  contractors.  There  is  frequent  commendation  of  the  spirit 
in  which  the  shipbuilders  carried  out  their  obligations.  So  quickly 
was  a  navy  equipped  that  the  secretary  of  the  navy  was  able  to  re- 
port by  December  1,  1862  that  four  hundred  and  twenty-seven  ves- 
sels had  been  added  to  the  navy  since  the  beginning  of  the  war. 
Some  of  these  were  merchant  ships  which  the  government  purchased 
and  converted  into  suitable  war  vessels,  others  were  the  latest  model 
iron-clads  recently  built.  The  secretary  speaks  of  the  difficulty  that 
even  the  best  equipped  yards  had  in  building  even  small  and  medium- 
sized  iron-clads  and  especially  in  obtaining  a  sufficient  supply  of 
iron  although  all  the  rolling  mills  capable  of  doing  the  work  had  been 
engaged  in  supplying  them.  He  recommended  that  the  government 
establish  a  plant  for  the  building  of  large  and  really  first-class  iron- 
clads which  the  private  yards  could  not  supply.97 

The  government  spent  hundreds  of  thousands  of  dollars  in  equip- 
ping and  improving  the  navy  yards,  but  after  all  most  of  the  work  was 
done  in  private  establishments.  During  the  war  seven  hundred  and 
thirty-eight  vessels  were  built  in  private  yards  for  the  navy  repre- 
senting a  value  of  $30,461,755.  One  hundred  and  seventy-five  mar- 
ine engines  representing  a  value  of  about  $21,000,000  were  built  at 
private  establishments.  Only  two  were  built  by  the  government 
itself.  The  total  value  of  the  work  done  in  building  vessels  and  en- 

97  House  Exec.  Doc.,  37  Cong.,  sess.  1,  No.  1,  vol.  iii. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  37 

gines  for  the  navy  department  during  the  war  amounted  to  $64,317,- 
778,  of  whicn  fully  eighty  per  cent  was  done  at  private  establishments. 
'  In  addition  to  this,  three  hundred  and  forty-three  vessels  rep- 
resenting a  value  of  more  than  $9,000,000,  and  a  tonnage  of  more 
than  a  hundred  thousand  were  built  for  or  purchased  by  the  war 
department.  All  of  these  were  built  in  private  yards,  as  were  also 
the  216,000  tons  purchased  for  the  navy  department  and  the  2503 
vessels  chartered  as  transports  which  represented  a  tonnage  of  757,- 
611.  The  total  tonnage  employed  by  the  government  in  these  differ- 
ent ways,  which  had  been  built  in  private  establishments  amounted 
to  1,175,132  tons.  Only  62,501  tons  were  built  at  the  navy  yards 
during  the  war.98 

The  effect  of  these  demands  of  the  government  upon  shipbuild- 
ing during  the  war  is  well  stated  by  Marvin  as  follows:99  "The  close 
of  the  war  found  American  steamship  building  a  very  much  better 
equipped  and  more  confident  industry  than  it  had  been  in  1861.  The 
yards  had  gained  experience  in  four  years  of  hard  work  for  the  gov- 
ernment. They  had  acquired  the  essential  machinery,  and  had  de- 
veloped an  adequate  force  of  skilled  workmen." 

WAR  TAXES 

The  taxes  brought  on  the  country  by  the  Civil  War  bore  heavily 
upon  our  merchant  shipbuilding.    Shipbuilding  materials  of  all  kinds 
were  subjected  to  import  duties  and  to  the  internal  revenue  taxes. 
Under  the  tariff  act  of  March  3,  1861100  all  forms  of  iron  bars  and 
plates  were  subject  to  a  duty  of  not  less  than  twenty  per  cent  ad 
valorem     On  boiler  plate  the  duty  was  twenty  dollars  a  ton,  as  wel 
as  on  all  other  forms  of  rolled  or  hammered  iron  not  otherwise  pro- 
vided for.    The  duty  on  wrought  iron  for  ships,  steam  engine! 
parts  thereof  was  a  cent  and  a  half  per  pound.     In  view  of  the  back- 
ward condition  of  American  iron  producing  industries,  this  was  a 
serious  handicap  to  the  development  of  iron  shipbuilding, 
terials  used  in  shipbuilding  such  as  lead,  copper,  white-lead  paints, 
linseed  oil,  etc.,  were  also  subjected  to  import  duties  under  this  act 
On  hemp  and  cordage  the  duties  were  heavy  although  a  drawb* 

9«  House  Exec.  Doc.,  41  Cong.,  sess.  2  vol.  vi,  No.  Ill,  p.  28. 

99  American  Merchant  Marine,  p.  341. 

100  36  Cong.,  sess.  2,  ch.  68. 


38  GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 

of  the  duty  on  hemp  imported  was  allowed  if  the  cordage  made  of  it 
was  exported. 

Even  if  American  shipbuilders  did  not  wish  to  import  these 
materials,  the  duties  helped  to  keep  up  the  price  of  domestic  materials 
and  the  price  of  these  was  still  further  enhanced  by  the  tax  imposed 
by  the  internal  revenue  act  of  July  1,  1862.101  The  tax  was  placed 
on  many  materials  used  in  shipbuilding  including  iron  and  steel  as 
well  as  a  tax  of  3  per  cent  on  the  receipts  of  passenger  fares  of  steam- 
boats. The  act  of  July  14,  1862102  greatly  increased  the  import  du- 
ties on  iron,  anchors,  cordages,  sail-duck,  etc. 

As  the  war  debts  piled  up,  the  taxes  became  heavier.  Under 
the  tariff  act  of  June  30,  1864103  iron  bars  were  subject  to  1J  cents 
a  pound  and  no  bars  were  to  pay  less  than  30  per  cent  ad  valorem. 
Wrought  iron  for  ships  was  subject  to  a  duty  of  2  cents  a  pound; 
cable  chains,  2J  cents;  and  anchors,  2i  cents  per  pound.  On  pig 
iron  the  duty  was  $9  a  ton  and  on  steel  2J  to  3|  cents  per  pound  plus 
10  per  cent  ad  valorem.  Manufactures  of  steel  were  to  pay  45  per 
cent.  Sail  duck  or  canvas  for  sails  was  to  pay  30  per  cent.  Cordage 
of  all  kinds  was  under  heavy  duty. 

The  internal  revenue  act  of  the  same  date104  placed  a  tax  of  2 
per  cent  on  the  hulls  of  all  vessels  of  whatsoever  kind  thereafter  built 
or  finished.  This  was  a  tax  directly  upon  shipbuilding.  Even  on 
all  repairs  made  on  ships,  steamboats  or  other  vessels  which  en- 
hanced their  value  10  per  cent,  there  was  a  tax  of  2  per  cent.  Marine 
engines  were  taxed  3  per  cent,  masts,  spars  and  vessel  blocks,  2  per 
cent;  and  sails  5  per  cent.  On  pig  iron  the  tax  was  $2  and  on  iron 
castings  $3  per  ton.  On  some  kinds  of  steel,  it  ran  up  as  high  as 
$12.50  per  ton.  Copper,  lead,  white-lead,  rivets,  etc.,  were  also  sub- 
ject to  this  internal  tax.  Receipts  from  steamboats,  ships,  barges  and 
canal  boats  were  subject  to  a  tax  of  2J  per  cent.  The  internal  reve- 
nue act  of  March  3,  1865105  increased  the  tax  on  marine  engines 
from  3  per  cent  to  5  per  cent.  The  tax  on  shipbuilding  was  increased 
by  placing  the  tax  on  "  hulls  as  finished  including  cabins,  inner  and 
upper  works"  instead  of  "  hulls  as  launched"  as  before. 

101  37  Cong.,  sess.  2,  ch.  119. 

102  37  Cong.,  sess.  2,  ch.  163. 

103  38  Cong.,  sess.  1,  ch.  171. 

104  38  Cong.,  sess.  1,  ch.  173. 

105  38  Cong.,  sess.  2,  ch.  78. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  39 

It  must  be  remembered  that  other  industries  were  likewise  sub- 
jected to  heavy  taxes,  but  shipbuilding  for  commercial  purposes  was 
suffering  under  other  disadvantages  and  consequently  was  unable  to 
bear  it.  So  when  the  war  was  over,  and  the  government  began  to 
reduce  the  internal  revenue  taxes  shipbuilding  was  one  of  the  first 
to  be  relieved.  The  act  of  July  13,  1866106  exempted  entirely  from 
the  internal  revenue,  the  hulls  of  ships  and  other  vessels,  also  masts, 
spars,  ship  and  vessel  blocks,  tree  nails,  and  deck  plugs,  and  all 
cordage,  ropes,  and  cables  made  of  vegetable  fiber.  The  5  per  cent 
tax  on  marine  engines  was,  however,  continued  as  were  the  taxes  on 
iron  rivets,  lead,  etc.  Most  of  these  were  continued  until  the  final 
repeal  of  the  war  taxes  in  1868.107  The  duties  on  imports,  also 
remained  in  force.  The  agitation  for  their  repeal  will  be  considered 
later. 

MAIL   SUBVENTIONS    1864   TO    1875 

The  aid  given  to  shipbuilding  by  the  government,  after  the  de- 
mand for  war  vessels  had  ceased,  came  through  the  contracts  for  a 
subsidized  mail  service  to  Brazil  and  to  the  Orient.     Cooperating 
with  the  Brazilian  government,  Congress,  in  1864  authorized108  a  con- 
tract by  which  the  United  States  was  to  pay  $150,000  as  its  half 
the  subsidy.     It  was  stipulated  that  the  mails  were  to  be  carried 
steamships,  of  not  less  than  2000  tons  displacement,  and  of  a  speed 
sufficient  to  make  twelve  round  trips  in  a  year.    They  were  to  be  con- 
structed of  the  best  materials  and  after  the  most  approved  models, 
with  all  modern  improvements.     They  were  also  to  be  subjected  to 
the  inspection  and  approval  of  an  experienced  naval  construct 
At  its  next  session  Congress  in  response  to  the  demands  of  California 
authorized109  the  postmaster-general  to  contract  for  a  monthly  ma 
service  between  San  Franciscoand  China.    Thisact  called  forfirst  class 
American  sea  going  steamships  of  not  less  than  3000  tons  each  and 
with  a  speed  sufficient  to  make  twelve  round  trips  a  year, 
steamers  were  to  be  fitted  out  with  most  modern  improvements  and 
to  be  approved  by  a  naval  constructor.     For  the  encouragement  o 
the  project  the  government  advanced  half  a  million  dollars  a  year. 

106  39  Cong.,  sess.  1,  ch.  184. 

107  40  Cong.,  sess.  2,  ch.  141. 

108  38  Cong.,  sess.  1,  ch.  98. 

109  38  Cong.,  sess.  2,  ch.  37. 


40  GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 

The  contract  was  let  to  the  Pacific  Mail  Steamship  Company  which 
began  the  service  in  1867.  In  the  spring  of  that  year  Congress  au- 
thorized110 a  change  in  the  route  by  cutting  out  the  stop  at  Honolulu 
and  extending  the  service  to  Japan  and  by  another  act111  set  aside 
$75,000  for  a  separate  service  to  Honolulu. 

Under  these  contracts,  the  Pacific  Mail  Steamship  Company 
built  four  wooden  side-wheel  steamers,  luxuriously  fitted  out,  but 
obsolete  in  design.  It  was,  however,  the  type  still  in  use  by  the  Cun- 
ard  Company  in  the  trans-Atlantic  service.  But  steamship  build- 
ing was  then  sufficiently  advanced  in  the  United  States  to  have  pro- 
duced modern  screw  propellers  much  more  efficient  and  better  adapted 
to  the  service  than  these.  This  aid  from  the  government  should 
have  brought  forth  something  better  from  our  ship-builders.  Later, 
there  were  put  into  this  service  high  class  iron  steamers  with  screw 
propellers  such  as  the  Granada  and  the  Colima.  The  Granada  was 
one  of  a  pair  of  3000-ton  steamers  built  by  Harlan^-  and  Hollings- 
worth  at  Wilmington,  Del.,  hi  1872  and  the  Colima  also,  about  3000 
tons,  was  one  of  a  pair  built  the  next  year  by  John  Roach  and  Sons. 
However  the  Pacific  Mail  Steamship  Company  did  build  two  really 
up-to-date  steamers  for  this  service.  This  was  done  under  a  con- 
tract which  the  government  authorized  by  the  act  of  June  1,  1872. 112 
This  provided  for  doubling  the  service  to  China  and  Japan  at  the 
same  rate  per  voyage.  The  stipulations  of  this  act  called  for  larger 
ships  of  a  better  type.  They  were  to  be  steamships  of  not  less  than 
four  thousand  tons  register  built  of  iron,  with  their  engines  and 
machinery  wholly  of  American  production  and  so  constructed  as  to 
be  readily  adapted  to  the  United  States  naval  service. 

Under  these  provisions  the  Pacific  Mail  Steamship  Company 
built  at  Chester,  Pa.,  in  the  yard  of  John  Roach  and  Sons  the  City  of 
Peking  and  the  City  of  Tokio.  Each  of  these  was  419  feet  in  length 
and  of  5080  tons  register.  They  were  by  far  the  finest  commercial 
steamships  that  had  yet  been  built  in  this  country.  They  were  a  real 
triumph  in  American  shipbuilding.  It  was  the  government  aid  that 
brought  it  about.  But  before  these  steamships  were  finished  it  was 
discovered  that  about  a  million  dollars  had  been  spent  in  lobbying 

110  39  Cong.,  sess.  2,  ch.  41. 

111  39  Cong.,  sess.  2,  ch.  182. 

112  42  Cong.,  sess.  2,  ch.  256. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  41 

to  secure  the  contract.113  Consequently,  the  act  of  March  3,  1875,114 
nullified  the  contract. 

The  shipbuilding  interests  were  anxious  to  have  the  contract 
continued.  John  Roach,  then  the  foremost  shipbuilder  in  the  coun- 
try, protested.115  The  Pennsylvania  legislature  entered  a  protest 
against  the  breaking  of  the  contract  and  adopted  a  resolution  in  favor 
of  fostering  in  every  manner,  the  building  of  American  ships,  by  Amer- 
ican mechanics,  and  of  American  materials.116  Similar  remonstrances 
came  from  the  San  Francisco  Chamber  of  Commerce  and  the  Cali- 
fornia Business  Interests,117  and  from  various  commercial  bodies  of 
New  York.118 

But  the  exposure  of  the  corrupt  lobbying  brought  such  dis- 
credit upon  the  whole  matter  of  ship  subsidies,  for  which  there  was 
no  strong  sentiment  throughout  the  country  anyway,  that  all  the 
contracts  were  ended.  This  aid  given  by  the  government  to  the 
Pacific  Mail  Steamship  Company  was  of  more  importance  in  the  his- 
tory of  American  shipbuilding  than  appears  in  the  number  of  ships 
built  for  the  service.  Excepting  the  demand  created  by  the  subsi- 
dized service  there  was  no  demand  for  trans-oceanic  steamers,  what- 
ever. What  foreign  commerce  our  shipowners  still  carried  on  was 
borne  in  sailing  vessels  as  was  also  by  far  the  larger  part  of  the  coast- 
ing trade.  Our  river  steamboats  were  smaller  and  did  not  demand 
the  kind  of  equipment  and  skill  that  had  been  developed  in  the 
yards  on  the  Delaware  under  the  government  contracts.  The  best 
equipped  and  most  efficient  establishments  for  building  iron  steam- 
ships in  the  Unitd  States  at  this  time  were  those  on  the  Delaware. 
They  had  the  natural  advantages  of  being  situated  on  deep  fresh 
water  and  near  an  abundant  supply  of  coal  and  iron.  But  the  demand 
for  high  class  shipbuilding  was  largely  due  to  orders  emanating  either 
directly  or  indirectly  from  the  government.  Cramps  had  developed 
enormously  during  the  war  in  filling  naval  demands,  and  now  the 
yards  at  Chester  and  Wilmington  achieved  their  greatest  success  in 
these  Pacific  mail  steamers. 

113  43  Cong.,  sess.  2,  House  Report  No.  268. 

114  43  Cong.,  sess.  2,  ch.  128. 

115  43  Cong.,  sess.  2,  Sen.  Mis.  Doc.  No.  85. 

116  43  Cong.,  sess.  1,  H.  Mis.  Doc.  No.  280. 

117  43  Cong.,  sess.  1,  H.  Mis.  Doc.  275. 

118  43  Cong.  sess.  Sen.  Mis.  Doc.  No.  94  and  No.  95. 


42  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

TARIFF  CONCESSIONS  TO   SHIPBUILDING 

After  the  Civil  War  had  ended  shipbuilding  suffered  very  greatly 
indeed.  The  demand  that  should  have  come  from  a  revived  com- 
merce upon  the  restoration  of  peace  did  not  come.  Our  shipowners 
could  not  compete  successfully  with  the  foreigners.  During  the  three 
years  following  the  war  our  shipowners  were  carrying  only  about  one- 
half  as  much  of  our  foreign  commerce  as  they  had  carried  during 
1861.  No  government  relief  was  attempted  until  1869  when  the 
House  of  Representatives  appointed  a  committee  to  inquire  into 
the  causes  of  the  decline  of  American  tonnage  in  our  foreign  shipping 
and  to  report  remedies  for  the  restoration  of  the  United  States  to 
its  former  position  as  a  maritime  power.  The  report  of  this  com- 
mittee, the  well-known  Lynch  report,  was  made  on  February  17, 
1870.119  In  the  hearings  before  the  committee  strong  demands  were 
made  by  ship  owners  that  they  should  be  allowed  to  purchase  foreign- 
built  ships  wherever  they  could  get  them  cheapest  and  have  them 
registered  as  American  ships.  They  were  also  pressing  in  their  de- 
mand that  American  ships  which  had  sought  protection  under  a  for- 
eign flag  during  the  Civil  War  should  be  readmitted  to  American 
registry.  Both  of  these  proposed  remedies  were  bitterly  opposed  by 
the  shipbuilders  who  appeared  before  the  committee.  They  main- 
tained that  they  could  build  ships  as  cheaply  as  they  were  being 
built  abroad,  if  they  could  import  shipbuilding  materials  free  of 
duty.  They  were  not  willing,  however,  to  risk  competition  with 
them;  for  they  were  opposed  to  the  proposal  to  allow  the  free  im- 
portation of  both  shipbuilding  materials  and  foreign-built  ships 
to  be  admitted  to  the  American  registry.  Indeed,  some  of  the  ablest 
shipbuilders  admitted  that  such  a  policy  would  close  up  American 
shipyards. 

The  report  of  the  committee  was  accompanied  by  two  bills  in- 
corporating the  remedies  it  considered  advisable.  The  proposal  to 
admit  foreign-built  ships  to  American  registry  was  rejected,  but  the 
shipbuilders'  demand  for  free  importation  of  shipping  materials  was 
provided  for  in  one  of  the  bills.  It  provided  for  a  drawback  of  duty 
paid  on  imported  lumber,  hemp,  manila,  composition  metal,  iron  not 
advanced  beyond  plates  and  bars,  rods  and  bolts.  When  American 
materials  were  used  on  iron  or  composite  vessels  or  steamers,  there  were 

119  41  Cong.,  sess.  2,  House  Reports,  vol.  1,  No.  28. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  43 

to  be  paid  bounties  equivalent  to  the  duties  on  the  materials  if  they 
had  been  imported.  This  was  primarily  in  the  interest  of  the  ship- 
builders but  the  shipowners  were  to  be  aided  by  liberal  navigation 
bounties  to  be  relieved  from  all  state  and  federal  taxation  except  a 
tonnage  tax  of  30  cents  which  foreign  vessels  would  also  have  to  pay. 

But  Congress  did  not  enact  these  proposals.  The  country  was 
no  longer  a  strip  of  Atlantic  coast  territory.  Railroads  and  agricul- 
tural machinery  had  opened  the  West.  The  most  enterprising  Amer- 
icans who  in  earlier  generations  might  have  been  merchant-princes 
or  shipbuilders  were  now  turning  their  energies  and  their  capital  to 
the  development  of  our  natural  resources  of  the  interior  farms  and 
mines.  These  internal  enterprises,  in  exploiting  a  virgin  country, 
yielded  returns  with  which  the  risks  of  the  seas  and  the  unequal  com- 
petition with  the  subsidized  steamships  of  Europe  did  not  compare 
favorably.  The  interior  interests  now  dominated  Congress.  Our 
legislators  were  much  more  interested  in  the  development  of  railroad 
lines  than  in  the  protection  of  the  merchant  marine.  It  is  signifi- 
cant that  a  national  convention  held  at  Chicago  in  1878120  for  the  pro- 
motion of  American  commerce,  and  opened  with  a  speech  by  Henry 
Watterson  which  he  began  by  saying  "I  believe  that  the  time  is 
coming  when  American  shipping  driven  from  the  sea,  will  whiten 
all  the  bays,  gulfs,  and  ports  of  the  civilized  world,"  was  most  in- 
terested in  urging  that  the  government  aid  in  the  speedy  comple- 
tion of  the  Northern  Pacific  and  the  Texas  Pacific  Railroads.  The 
first  three  of  the  five  resolutions  adopted  dealt  with  the  Pacific  Rail- 
roads; the  fourth  recommended  the  subsidized  American-built  steam- 
ers to  the  south  of  us  and  the  fifth  dealt  with  an  inland  waterway 
behind  Cape  Hatteras. 

This  very  policy  of  encouraging  railroad  development  operated 
to  the  disadvantage  of  the  shipping  interests.  In  October  1869  Mr. 
Low  complained121  before  the  Lynch  Committee  that  the  govern- 
ment had  given  $50,000,000  or  more  besides  extensive  lands  to  the 
Pacific  Railroad,  and  that  this  had  already  brought  to  the  Pacific 
Mail  Steamship  Company  a  loss  of  $6,000,000  or  $8,000,000.  In 
two  years  its  stock  of  $20,000,000  fell  from  $150  to  $56  a  share. 

Though  shipbuilders  were  not  granted  the  privileges  incorpor- 
ated in  the  bill  of  1870,  two  years  later  some  concessions  were  made 

120  45  Cong.,  sess.  3  House  Mis.  Doc.  No.  14. 
"I  41  Cong.,  sess.  2,  House  Rep.  No.  28,  p.  44. 


44  GOVERNMENT  AID   TO   AMERICAN  SHIPBUILDING 

in  the  tariff  act  passed  June  6,  1872.122  This  allowed  the  free  impor- 
tation of  materials  for  building  and  equipping  wooden  vessels  "to  be 
employed  in  the  foreign  trade  and  between  the  Atlantic  and  Pacific 
ports  of  the  United  States."  But  the  proviso  that  vessels  receiving 
the  benefit  of  this  concession  * 'shall  be  allowed  to  engage  in  the  coast- 
wise trade  for  not  more  than  two  months  hi  any  one  year/'  practically 
destroys  all  advantage  that  might  have  come  from  it.  This  same 
act  also  granted  that  all  articles  of  foreign  production  needed  for 
the  repair  of  American  vessels  engaged  exclusively  in  the  foreign 
trade  might  be  imported  free  of  duty.  But  since  the  number  of  Amer- 
ican vessels  engaged  in  foreign  trade  exclusively  has  been  small 
this  concession  has  been  of  very  little  practical  benefit  to  American 
shipbuilding. 

Another  tariff  concession  was  made  in  the  act  of  June  26,  1884.123 
Section  17  provides  that  "when  a  vessel  is  built  in  the  United  States 
for  foreign  account,  wholly  or  partly  of  foreign  materials,  on  which 
import  duties  have  been  paid,  there  shall  be  allowed  on  such  vessels 
when  exported  a  drawback  equal  in  amount  to  the  duties  on  such 
materials."  The  United  States,  however,  was  to  retain  10  per  cent  of 
such  drawback, 

In  the  McKinley  act  of  1890124  the  concessions  of  the  acts  of 
1872  and  1884  are  continued  and  materials  used  in  building  iron 
and  steel  ships  are  added  to  those  that  may  be  imported  on  the  same 
terms  as  those  for  wooden  vessels. 

All  these  concessions  have  been  continued  in  the  later  tariff 
acts.  But  the  restriction  that  a  ship  built  of  materials  imported 
free,  cannot  engage  in  the  coasting  trade  of  the  United  States  for 
more  then  two  months  in  a  year  has  made  these  concessions  of  little 
practical  value.  No  American  shipowner,  under  present  conditions, 
builds  a  deep  sea  ship,  even  though  she  be  designed  primarily  for 
foreign  commerce,  without  considering  that  he  may  be  glad  some 
day  to  fall  back  on  the  coastwise  trade  which  now  includes  the  trade 
to  our  over-sea  possessions.  Therefore  this  apparently  liberal  con- 
cession of  free  importation  of  shipbuilding  materials  has  after  all 
been  of  very  little  real  importance. 

The  Merchant  Marine  Commission  of  1904  reported  that  only 

122  42  Cong.,  sess.  2,  ch.  316,  sec.  10. 

123  48  Cong.,  sess.  1,  ch.  121. 

124  51  Cong.,  sess.  1,  ch.  1244. 


GOVEENMENT  AID   TO   AMERICAN   SHIPBUILDING  45 

one  large  steel  ship  the  Dirigo,  had  been  built  under  this  concession. 
Her  builders,  Arthur  Sewall  and  Company,  Bath,  Me.,  said  that  the 
Dirigo  was  a  cause  of  constant  anxiety  to  them,  for  if  the  vessel  were 
to  be  more  than  two  months  on  the  voyage  between  Puget  Sound 
and  Hawaii,  the  duties  would  have  to  be  paid  on  the  foreign  plates, 
angles  and  beams  of  which  she  was  constructed.  Consequently,  the 
Sewall  Company  did  not  again  avail  itself  of  the  free-list  privilege, 
although  they  had  built  several  steel  ships  since.125 

The  Merchant  Marine  Commission  recommended  that  this  coast- 
ing restriction  be  extended  from  two  months  to  six  months  in  a  year 
and  be  made  an  all-the-year-round  privilege  for  vessels  in  the  trade 
to  the  Phillippines  as  it  already  had  been  for  the  Atlantic-Pacific 
trade.  No  action  was  taken  upon  this  recommendation  until  the 
tariff  act  of  August  5,  1909126  made  the  coasting  restriction  six 
months  in  a  year  but  said  nothing  about  the  Philippine  trade. 

This  tariff  act  also  contained  another  provision  which  concerned 
shipbuilding.  Under  section  37,  foreign-built  yachts  owned  by  Ameri- 
can citizens  are  subjected  to  an  annual  tax  of  $7  per  gross  ton  or 
else  to  an  import  duty  of  35  per  cent  ad  valorem.  In  the  first  year 
under  this  act  eight  foreign  built  yachts  paid  the  annual  tax  and 
three  paid  the  duty.127 

AMERICAN  REGISTRY   POLICY  SINCE   THE   CIVIL  WAR 

As  has  already  been  pointed  out,  about  800,000  tons  of  Ameri- 
can shipping  passed  into  foreign  hands  during  the  Civil  War.  When 
the  dangers  of  the  war  were  over  some  of  this  tonnage  would  have 
returned  to  the  protection  and  the  advantages  of  American  registry. 
Congress,  however,  prevented  this  by  passing  an  act  intended  to 
benefit  the  shipbuilders  of  the  United  States.  This  act  passed  in 
February  1866128  excluded  from  American  registry  all  ships  that  had 
taken  refuge  under  the  protection  of  any  foreign  flag  or  government 
during  the  Civil  War. 

By  1869,  when  the  government  took  up  the  question  of  relief  to 
our  maritime  interests,  strong  pleas  were  made  in  the  hearings  of 
the  Lynch  commitee  for  the  repeal  of  this  act.  But  this  committee 

125  Report  of  the  Merchant  Marine  Commission,  vol.  i,  p.  ix. 

126  61  Cong.,  sess.  1,  ch.  6,  sec.  18  sec.  19. 

127  Report  of  the  Commissioner  of  Navigation,  1910,  p.  17. 

128  39  Cong.,  sess.  1.  ch.  8. 


46  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

very  properly  pointed  out  in  its  report  to  Congress  that  "To  allow 
citizens  to  avail  themselves  of  all  the  advantages  conferred  by  our 
government  during  peace,  and  escape  all  the  risks  of  supporting  it 
during  the  war,  by  placing  their  property  at  such  times  under  the 
protection  of  a  foreign  flag  would  be  a  dangerous  precedent  to  es- 
tablish."129 It  is  probably  true  that  this  policy  did  not  aid  our  ship- 
builders materially,  but  the  government  could  not  afford  to  sacri- 
fice the  principle  involved  for  such  advantages  as  its  repeal  might 
have  brought  to  American  shipping. 

Although  Congress  thus  maintained  the  general  policy  of  grant- 
ing American  registry  only  in  such  a  way  as  would  be  to  the  best  in- 
terests of  American  shipbuilding,  some  of  this  alienated  tonnage  was 
re-admitted  by  special  acts.  In  the  same  manner  some  foreign-built 
vessels  were  granted  American  registry.  The  act  of  April  25,  1866 
granted  American  registry  to  twenty  craft  including  several  Cana- 
dian-built, and  on  July  20,  1868,  there  was  authorized  registry  or 
enrollment  to  seventeen  Canadian-built  ships  employed  upon  the 
Great  Lakes  and  owned  by  American  citizens  upon  condition  that 
they  pay  a  tax  equal  to  the  internal  revene  tax  upon  the  materials 
and  construction  of  similar  vessels  of  American  build.  During  the 
next  decade  a  number  of  such  special  acts  were  passed  which  ad- 
mitted about  twenty-five  thousand  tons  of  foreign  shipping  to  Ameri- 
can registry. 

Even  before  the  war,  Congress  had  frequently  granted  registers 
to  foreign  vessels  by  special  act,  but  the  total  tonnage  thus  admitted 
was  not  so  large.  For  the  second  decade  after  the  close  of  the  war, 
the  amount  thus  admitted  was  small.  Since  1885  Congress  has 
admitted  a  considerable  tonnage  (nearly  200,000  tons)  by  special 
acts.  In  1891,  18,000  tons  were  admitted;  in  1893,  22,000  tons;  in 
1898  nearly  28,000  tons;  in  1900,  21,000  tons;  and  in  1901,  nearly 
42,000  tons.130  These,  however,  are  the  highest  years  and  most  of 
them  can  be  explained  in  connection  with  the  Spanish-American  War, 
and  the  nationalization  of  the  Hawaiian  and  Porto  Rican  vessels. 

Four  or  five  years  after  the  close  of  the  Civil  War  when  the  gov- 
ernment was  turning  its  ear  to  the  shipping  interests  in  the  hope  of 
finding  some  way  to  revive  our  maritime  industries  another  change 

129  41  Cong.,  sess.  2  H.  Report,  No.  28,  p.  xi. 

130  Report  of  Commissioner  of  Navigation,  1910,  p.  224-226.     Table  showing 
all  foreign-built  tonnage  admitted  by  special  acts,  1813-1910. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  47 

in  the  registry  laws  was  urged.  It  was  proposed  that  we  should 
abandon  our  old  policy  of  granting  American  registry  to  American- 
built  ships  exclusively.  Up-to-date  steamships  could  now  be  built 
in  England  for  at  least  a  third  less  than  in  the  United  States.  Cer- 
tain shipping  interests,  therefore,  claimed  that  the  United  States 
could  again  carry  its  former  share  of  foreign  commerce  if  foreign- 
built  vessels  could  be  admitted  to  American  registry.  They  de- 
manded that  they  should  be  allowed  to  purchase  their  ships  where 
they  could  buy  cheapest.  Some  frankly  admitted  that  the  adoption 
of  this  policy  would  ruin  our  shipbuilding  industry,  but  most  of  the 
"free  ship"  advocates  argued  that  in  the  end  it  would  be  a  benefit 
even  to  the  builders  of  vessels.  They  argued  that  stagnation  now 
reigned  in  all  our  shipyards,  but  that  the  admission  of  foreign-built 
ships  to  American  registry  would  enable  them  to  restore  the  ship- 
ping business,  which  in  turn,  would  create  a  demand  upon  ship- 
builders for  repairs  and  later  would  increase  shipbuilding  in  the  United 
States  to  a  point  of  such  efficiency  that  ultimately  they  would  be 
able  to  compete  with  foreign  builders. 

The  leading  American  shipbuilders  all  of  whom  set  their  views 
before  the  Lynch  committee  were  bitterly  opposed  to  the  admission 
of  foreign-built  vessels.  They  all  agreed  that  it  would  ruin  the  ship- 
building industry  in  the  country.  Most  of  them  thought  the  gov- 
ernment should  aid  them  by  bounties  and  draw-backs  on  ship  ma- 
terials so  that  they  could  furnish  American-built  vessels  as  cheaply 
as  they  could  be  built  abroad. 

The  committee  after  hearing  both  sides,  reported  against  the 
admission  of  foreign-built  vessels  even  if  they  were  to  pay  an  im- 
port duty  as  was  suggested  by  some  who  had  more  consideration 
for  our  shipbuilders.  But  this  was  not  the  end  of  the  "free  ship" 
agitation.  On  March  15,  1872,  there  was  introduced  into  the  House 
a  bill  providing  for  the  admission  to  American  registry  foreign-built 
ships  wholly  owned  by  citizens  of  the  United  States.131  The  agita- 
tion was  kept  up  and  in  the  eighties  it  became  acute.  In  a  lengthy 
speech  on  January  27,  1881,  Senator  Beck  of  Kentucky  defended  the 
position  expressed  in  a  resolution  submitted  by  him  two  days  before. 
This  declared  "that  all  the  provisions  of  law  which  prohibited  our 
citizens  from  purchasing  ships  to  engage  in  the  foreign  carrying  trade 

131  House  Exec.  Doc.  No.  194,  vol.  10,  42  Cong.,  sess.  2. 


48  GOVEKNMENT   AID   TO   AMEKICAN   SHIPBUILDING 

or  which  prevent  the  registration  of  them  as  American  ships,  when 
owned,  commanded  and  officered  by  citizens  of  the  United  States 
ought  to  be  repealed."132  This  speech  was  anwered  by  Mr.  Elaine. 
The  question  now  became  partisan  and  involved  in  the  general  ques- 
tion of  "Protection"  vs.  "Free  Trade."  The  Committee  of  Naval 
Affairs  also  reported  favorably  a  "free  ship"  bill  into  the  House. 

In  the  next  Congress  the  matter  came  up  again.  A  joint  select 
committee  was  appointed  to  inquire  into  the  considerations  and 
wants  of  the  American  shipbuilding  and  shipowning  interests  and  to 
suggest  any  remedies  that  might  be  applied  by  legislation.  The 
report  of  this  committee  presented  by  Mr.  Nelson  Dingley  Jr.,133 
was  strong  against  free  ships,  but  a  minority  report  favored  them. 

The  agitation  continued  and  in  1884  Mr.  Dingley134  and  his 
friends  on  the  Committee  on  American  Shipbuilding  and  Shipowning 
Interests  again  reported  unfavorably  on  the  "free  ship"  bill  before 
the  House.  The  reasons  given  were  that  it  would  be  an  injustice 
to  shipbuilders  while  all  other  industries  were  protected;  that  it 
would  result  in  the  destruction  of  the  shipbuilding  industry  in  this 
country,  and  would  not  materially  increase  our  shipping,  since  the 
first  cost  of  a  vessel  was  but  a  small  part  of  the  cost  of  operation; 
that  it  would  open  the  demand  for  the  admission  of  foreign-built 
ships  into  the  coastwise  trade;  and  finally,  it  would  destroy  the 
naval  reserve  power  that  resided  in  our  shipbuilding  establishments. 
On  this  last  point  Jefferson  and  Madison  were  quoted  to  show  the 
wisdom  of  their  policy  in  our  fundamental  maritime  legislation. 

Two  years  later,  in  1886,135  the  majority  of  the  Committee  on 
Shipbuilding  and  Shipowning  Interests  reported  favorably  a  bill 
which  would  have  admitted  foreign-built  vessels  into  the  coastwise 
as  well  as  into  the  foreign  commerce.  The  arguments  advanced  in 
favor  of  the  bill  were  the  usual  ones;  that  the  American  registry 
policy  was  obsolete  and  reacted  disastrously  on  our  shipping  and 
even  on  shipbuilding  itself,  for,  "unless  there  be  employment  for 
ships  there  can  be  no  demand  for  them;  all  civilized  nations  now 
have  free  ships;  the  important  interest  involved  was  not  shipbuild- 
ing but  shipping,  and  finally  the  decline  of  American  shipping  might 

132  Congressional  Record,  46  Cong.,  sess.  3. 

133  47  Cong.,  sess.  2,  House  Report  No.  1827— Senate  Report  No.  883. 

134  48  Cong.,  sess.  1,  House  Report  No.  750. 

135  49  Cong.,  sess.  1,  House  Report,  No.  1332. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  49 

have  been  avoided  if  her  merchants  had  been  permitted  to  buy  iron 
and  steel  steamers  where  they  could  get  them  cheapest.  The 
minority  headed  by  Mr.  Dingley  opposed  the  bill  for  the  same  rea- 
sons that  he  had  given  before.  "  Instead  of  destroying  our  ship- 
yards/' he  said,  "the  government  should  build  them  up  at  whatever 
cost,  as  England  did.  We  should  stick  to  our  policy  of  American 
ships  built  in  American  yards/' 

In  the  next  Congress  this  bill  was  again  urged  in  the  House  by 
Mr.  Dunn's  committee,  amended,  however,  so  that  no  foreign-built 
vessel  could  participate  in  the  coastwise  trade.  Mr.  Dingley  now136 
points  out  that  "this  bill  originates  in  a  remarkable  manner,  for 
aside  from  the  bare  majority  of  members  of  this  committee  who  fa- 
vored the  bill  and  an  individual  who  advocated  the  inclusion  of  the 
coastwise  tonnage  in  the  provisions  of  the  bill,  not  a  person,  nor  a 
company,  nor  maritime  association,  nor  a  trade  guild  or  union  of 
workmen,  nor  single  Knight  of  Labor,  nor  an  American  sailor,  nor 
an  American  merchant,  nor  an  American  shipper  has,  by  personal 
appeal  or  petition,  asked  for  the  enactment  of  this  bill  into  a  law." 

In  spite  of  such  a  condition  the  agitation  has  continued.  Almost 
every  Congress  has  had  before  it  such  a  bill  sometimes  receiving  a 
good  deal  of  favorable  consideration.  There  is  no  likelihood  of  an 
unlimited  "free  ship"  policy  gaining  support.  The  public  is  sus- 
picious of  the  motives  of  its  advocates;  besides  whatever  justifi- 
cation there  might  have  been  for  it  in  the  seventies  before  the  devel- 
opment of  our  iron  and  steel  industries  has  now  passed  away.  Our 
changed  naval  policy  and  the  interests  of  the  government  in  keeping 
up  first-class  shipbuilding  establishments  for  naval  reasons  also  act 
against  a  "free  ship"  policy. 

Yet  every  commission,  committee,  or  individual  who  discusses 
the  American  merchant  marine  still  gives  attention  to  this  question. 
In  his  report  of  1909,  the  commissioner  of  navigation  said  that  little 
injury  would  come  to  American  shipbuilders  if  foreign  ships  were 
granted  admission  to  the  foreign  trade  only,  since  they  are  not 
building  for  this  trade  under  the  present  law.  He  also  points  out 
that  the  admission  of  foreign-built  ships  into  foreign  trade  would 
probably  not  help  our  shipping  in  the  foreign  trade.  Many  disin- 
terested students  and  patriotic  Americans  have  come  to  believe  that 

136  50  Cong.,  sess.  1,  House  Report  1874. 


50  GOVERNMENT  AID   TO  AMERICAN   SHIPBUILDING 

this  would  aid  our  shipping  and  could  do  no  harm  to  shipbuilding, 
but  through  the  increased  shipping  would  even  create  demands  on 
our  shipyards.  Replies  received  by  the  Merchant  Marine  Com- 
mission from  Americans  who  operate  a  large  tonnage  under  foreign 
flags  are  unanimous  in  declaring  that  they  would  not  transfer  their 
fleets  to  American  registry,  if  there  were  no  other  inducements. 

The  coastwise  trade,  the  Americans  will  not  throw  open  now  to 
foreign-built  ships,  although  in  1908  a  bill  passed  one  branch  of  Con- 
gress which  would  have  opened  the  carrying  between  the  Pacific 
Coast  and  the  Hawaiian  Islands. 

Although  Congress  has  steadfastly  refused  to  change  the  American 
registry  policy,  it  did  pass  an  act  in  1892  which  made  slight  modifi- 
cations.137 This  act  entitled  "An  Act  to  Encourage  American  Ship- 
building" provides  for  the  admission  to  American  registry  of  certain 
foreign-built  steamers  engaged  in  the  foreign  trade  of  the  United 
States  on  condition  that  the  American  owners  obtain  full  title  and 
that  they  build  in  the  shipyards  of  the  United  States  similar  steam- 
ships of  an  aggregate  tonnage  not  less  than  that  admitted.  This 
act  although  worded  in  general  terms  was  really  a  piece  of  special 
legislation  intended  to  admit  the  British-built  City  of  Paris  and  City  of 
New  York  to  American  registry. 

These  two  steamers  had  been  built  by  the  International  Naviga- 
tion Company,  an  American  corporation  which  had  bought  the  In- 
man  Line,  one  of  the  three  trans-Atlantic  lines  subsidized  by  the 
British  government.  When  these  vessels  were  built,  the  British 
government  refused  to  continue  the  contract  by  which  a  subsidy 
would  be  paid  to  a  line  so  largely  owned  by  American  capital.  The 
owners  thereupon,  appealed  to  Congress  to  have  them  admitted  to 
American  registry  in  order  that  they  might  take  avantage  of  the 
mail  payments  provided  by  the  ocean  mail  act  of  1891.  It  was  in  re- 
sponse to  this  request  that  Congress  passed  the  above  act  which 
allowed  these  vessels  to  enjoy  all  the  privileges  of  American  ships 
except  those  of  the  coastwise  trade. 

Under  the  terms  of  this  act  the  International  Navigation  Com- 
pany built  two  splendid  modern  steamers,  the  St.  Louis  and  the  St. 
Paul  in  Cramp's  Shipyard  in  Philadelphia.  They  surpassed  any 
other  merchant  ships  that  had  yet  been  built  in  this  country.  Cramp's 

137  52  Cong.,  sess.  1,  ch.  63. 


GOVEENMENT  AID   TO   AMERICAN   SHIPBUILDING  51 

Shipyard  had  been  turning  out  ships  for  two  generations.  It  had 
greatly  increased  its  efficiency  during  the  Civil  War  and  was  just 
becoming  the  foremost  establishment  in  the  United  States  by  doing 
splendid  work  for  the  government  in  building  our  new  steel  navy. 
The  St.  Louis  and  the  St.  Paul  are  554  feet  in  length,  63  feet  wide, 
and  51  feet  deep,  and  of  11,600  tons  gross  register.  Under  the 
naval  requirements  of  the  act  and  the  ocean  mail  contract  under 
which  they  were  constructed,  they  were  very  carefully  and  securely 
built.  It  is  a  matter  of  pride  to  Amricans  that  for  a  time  they  were 
the  fastest  and  finest  commercial  vessels  afloat — although  they  are 
now  becoming  antiquated. 

Encouraged  by  the  success  of  the  International  Navigation  Com- 
pany the  Pacific  Mail  Steamship  Company  made  a  similar  proposal 
to  Congress.  The  Committee  on  Merchant  Marine  and  Fisheries 
reported  favorably  a  bill  (June  15,  1892)  for  granting  American  reg- 
istry to  the  British-built  steamship  China  which  this  company  had 
acquired  to  replace  the  City  of  Tokio  lost  at  sea.  The  passage  of 
this  bill  was  urged  because  the  Oriental  line  was  encountering  the 
competition  of  the  line  from  Vancouver  to  Yokohoma  recently  es- 
tablished by  a  subsidy  of  half  a  million  dollars  per  year  from  the  Brit- 
ish and  Canadian  governments,  because  the  navy  department  fa- 
vored it  and  for  the  further  reasons  that  the  company  promised  to 
build  in  the  shipyards  of  the  United  States  two  much  larger  steamers. 
It  was  also  pointed  out  that  this  company  had  built  or  purchased 
about  fifty  American-built  iron  steamships,  twenty  of  these  it  now 
had  in  service,  and  had  under  construction  four  steamers  of  3500 
tons.  In  spite  of  these  apparently  good  reasons  the  bill  failed  to 
become  a  law.138 

Soley,  writing  about  this  time,  thinks  here  is  a  compromise  plan 
which  might  be  used  to  the  advantage  of  both  the  shipowning  and 
the  shipbuilding  interests,  unfortunately  Congress  has  not  adopted  it 
as  a  general  policy.139 

The  acquisition  of  over  seas  territories  by  the  United  States  has 
caused  an  extension  of  our  coasting  and  registry  laws.  The  act  of 
April  12,  1900,140  authorized  the  commissioner  of  navigation  to  make 

138  The  China  was  however  later  admitted  to  American  registry. 

139  The  Maritime  Industries  of  America  by  J.  R.  Soley  in  Shaler's  United 
States,  vol.  1. 

140  56  Cong.,  sess.  1,  ch.  191,  sec.  9;  Navigation  Laws  of  U.  S.  1907,  p.  24. 


52  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

such  regulations  as  he  might  deem  expedient,  for  the  nationaliza- 
tion of  all  vessels  owned  by  the  inhabitants  of  Porto  Rico  on  April  11, 
1899,  and  which  continued  to  be  so  owned  to  the  date  of  such  na- 
tionalization. Ships  thus  nationalized  were  to  be  admitted  to  all 
the  benefits  of  the  coasting  trade  of  the  United  States.  The  same 
act  extended  the  restrictions  of  our  coasting  laws  to  the  trade  be- 
tween Porto  Rico  and  the  United  States,  thus  reserving  this  trade 
to  American  ships. 

The  Hawaiian  trade  was  likewise  reserved  for  American  ships 
by  the  act  of  April  30,  1900.141  This  act  also  admitted  to  American 
registry  all  vessels  carrying  Hawaiian  registers  on  August  12,  1898, 
which  were  owned  by  citizens  of  the  United  States  or  of  Hawaii 
besides  five  other  vessels  especially  named.  A  temporary  act  of 
April  15,  1904,142  excluded  foreign  vessels  from  carrying  merchan- 
dise or  passengers  between  the  United  States  and  the  Philippines. 
It  was  stipulated  that  the  restrictions  of  the  United  States  coast- 
wise trade  were  not  to  be  applied  to  the  trade  between  two  ports  in 
the  Philippine  Archipelago  until  Congress  should  authorize  the  reg- 
istry of  vessels  owned  by  inhabitants  of  the  Philippines.  These  tem- 
porary measures  were  re-enacted  on  April  30,  1906,143  and  still  form 
the  legal  status  of  this  trade. 

This  application  of  our  coasting  laws  is  helping  our  shipbuilders 
a  little.  The  two  largest  merchant  ships  built  in  the  United  States 
in  1910,  the  Wilhemina,  6974  tons  and  the  Kentuckian,  6606  tons,  were 
put  into  the  Hawaiian  service.  The  commissioner  of  navigation 
points  out144  that  under  the  applications  of  the  coasting  laws  to  the 
Hawaiian  trade  and  the  trade  by  way  of  the  Isthmus  of  Tehauntepec 
shipbuilding  for  these  trades  has  steadily  increased.  He  declares  that 
it  has  scarcely  kept  pace  with  the  increased  demand  for  transporta- 
tion facilities.  To  provide  better  facilities,  there  has  been  pending 
a  bill  to  allow  foreign  ships  to  carry  passengers  between  Hawaii 
and  the  mainland.  This  is  not  the  proper  way  to  meet  the  situa- 
tion and  the  commissioner  of  navigation  urges  the  importance  of 
having  at  hand  a  sufficient  number  of  American  ships  to  meet  the 
increased  demand  when  the  Panama  Canal  will  be  opened  four  years 
hence. 

141  56  Cong.,  sess.  1,  ch.  339,  sec.  98;  Navigation  Laws,  1907,  p.  238. 

142  58  Cong.,  sess.  2,  ch.  1314. 

143  59  Cong.,  sess.  1,  ch.  2071,  Navigation  Laws,  1907,  p.  245. 

144  Report  of  Commissioner  of  Navigation,  1910,  p.  12. 


GOVERNMENT   AID   TO    AMERICAN   SHIPBUILDING  53 

THE   OCEAN  MAIL  ACT 

Since  the  repeal  of  the  mail  subsidies  for  the  Brazilian  and  the 
Oriental  services,  there  has  been  only  one  other  law  passed  to  aid  our 
merchant  marine  by  means  of  mail  payments.  This  is  the  ocean 
mail  act  of  March  3,  1891. 14S  The  postmaster-general  is  authorized 
by  this  act  to  enter  into  contracts  for  a  term  of  not  less  than  five  years 
nor  more  than  ten  years  for  carrying  mails  between  the  United 
States  and  such  foreign  countres  "as  in  his  judgment  will  best  sub- 
serve and  promote  the  postal,  and  commercial  interests  of  the  United 
States." 

The  vessels  employed  in  this  service  must  be  American-built 
steamships.  Provision  is  made  for  four  classes  of  vessels.  Those 
of  the  first  class  are  required  to  be  iron  or  steel  screw  steamships, 
capable  of  maintaining  a  speed  of  twenty  knots  an  hour  at  sea  in 
ordinary  weather,  and  of  a  gross  registered  tonnage  of  not  less  than 
8000  tons,  those  of  the  second  class  are  required  to  be  iron  or  steel 
steamships  capable  of  maintaining  a  speed  of  sixteen  knots  in  ordi- 
nary weather  and  of  a  gross  registered  tonnage  of  not  less  than  5000. 
For  the  third  class  the  speed  requirement  is  fourteen  knots  and  the 
size  at  least  2500  tons,  vessels  of  the  fourth  class  may  be  of  wood  and 
the  speed  requirement  is  only  twelve  knots.  For  the  service  between 
the  United  States  and  Great  Britain  only  vessels  of  the  first  class 
may  be  employed.  It  is  also  stipulated  that  the  ships  of  the  first 
three  classes  shall  be  built  with  particular  reference  to  prompt  and 
economical  conversion  into  auxiliary  naval  cruisers,  consequently 
they  are  to  be  constructed  under  the  direction  and  approval  of  the 
naval  authorities. 

The  compensation  allowed  under  this  act  is  fixed  at  the  rate  of 
$4  a  mile  for  steamships  of  the  first  class,  $2  for  those  of  the  second 
class,  $1  for  the  third,  and  two-thirds  of  a  dollar  for  the  fourth  class. 
These  payments  have  proved  insufficient  to  produce  the  desired  in- 
crease in  American  shipping  and  shipbuilding.  The  most  important 
ships  built  under  the  provisions  of  the  act  are  the  St.  Paul  and  the 
St.  Louis  of  the  American  line  described  in  a  preceding  section.  Four 
other  lines  are  operating  steamships  under  the  authority  of  this  act. 
The  payments  to  these  four  other  lines  amount  to  about  half  a 
million  dollars  annually. 

145  51  Cong.,  sess.  2,  ch.  519. 


54  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

The  act  has  not  had  very  important  results  in  shipbuilding. 
Although  the  five  lines  receiving  payments  under  contracts  author- 
ized by  the  act  have  about  twenty  ships  in  operation,  none  of  them 
except  the  St.  Paul  and  St.  Louis  mark  any  great  advance  in  Ameri- 
can shipbuilding.  These  two  ships  were  built  under  the  special  addi- 
tional inducement  of  the  privilege  of  having  the  two  similar  foreign- 
built  ships  admitted  to  American  registry. 

That  the  payments  authorized  by  this  act  were  too  small  to 
produce  very  important  results  soon  became  generally  recognized. 
Numerous  attempts  have  been  made  to  induce  Congress  to  increase 
the  payments,  but  these  attempts  have  all  been  without  success. 
Some  of  the  most  notable  attempts  of  the  last  decade  are  Senator 
Frye's  bill  introduced  in  December,  1901,  the  measures  recommended 
by  the  Merchant  Marine  Commission  in  1905  and  the  amendments 
of  the  ocean  mail  act  of  1891  before  the  last  Congress.  The  Frye 
bill  proposed  a  general  subsidy,  a  subsidy  for  deep-sea  fisheries,  and 
ocean  mail  payments  which  were  to  take  the  place  of  those  author- 
ized by  the  ocean  mail  act  of  1891.  The  bill,  if  enacted,  would 
have  required  the  expenditure  of  millions  in  aid  of  navigation  and 
would  have  given  some  aid  to  shipbuilding.  Special  inducements 
were  offered  for  shipbuilding  by  a  provision  of  higher  subsidies  for 
vessels  built  within  the  five  years  following  its  enactment  into  law. 
The  bill  recommended  by  the  Merchant  Marine  Commission146  pro- 
fessed to  be  for  the  promotion  of  naval  power,  the  establishment  of 
ocean  mail  lines  to  foreign  markets,  and  the  advancement  of  commerce. 
The  bill  does  not  disturb  the  five  contracts  under  the  act  of  1891,  but 
it  proposes  increased  payments  for  ten  lines  of  ocean  mail  steamers 
to  the  countries  south  and  west  of  the  United  States.  The  maximum 
expenditure  for  these  ten  lines  was  placed  at  $2,665,000.  The  latest 
attempts  have  been  to  amend  the  ocean  mail  act  of  1891  so  as  to 
allow  $4  a  mile,  instead  of  $2  to  vessels  of  the  second  class  in  the 
South  American  and  the  trans-Pacific  services.147  Such  a  measure 
was  passed  by  the  Senate  in  1911,  but  failed  to  become  a  law. 


146  Report  of  American  Merchant  Marine  Commission,  vol.  1,  p.  xlvi. 

147  Report  of  the  Commissioner  of  Navigation,  1910,  p.  8. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  55 

RECENT  NAVAL   POLICY 

Our  new  naval  policy  had  its  beginning  when  the  secretary  of  the 
navy,  William  H.  Hunt,  appointed  a  naval  advisory  board  of  which 
Rear- Admiral  John  Rodgers  was  president  to  inquire  into  the  needs 
of  our  navy.  This  board  reported  November  7,  1881,  that  there 
were  only  thirty-two  vessels  which  were  then  available  or  could  be 
made  so  at  a  cost  low  enough  to  warrant  the  expenditure.  Of  these, 
only  eight  were  in  reserve  "while  throughout  the  world  it  is  recog- 
nized that  in  order  to  keep  up  the  strength  of  a  wooden  fleet  a  reserve 
of  50  per  cent  is  necessary."  The  board  recommenced  the  construc- 
tion of  thirty-eight  unarmored  cruisers  with  a  minimum  speed  of 
ten  to  fifteen  knots  an  hour.  The  ten-knot  class,  they  recommended, 
should  be  built  of  wood  with  live-oak  frames,  planked  and  ceiled 
with  yellow  pine.  For  the  thirteen,  fourteen  and  fifteen-knot  ves- 
sels, the  board  was  at  first  inclined  to  favor  iron,  since  iron  shipbuild- 
ing was  now  well  developed  in  the  United  States,  and  since  there 
was  a  lack  of  experience  in  making  steel  frames  in  this  country.  Even 
in  Europe  steel  shipbuilding  was  still  in  the  experimental  stage. 
But  upon  further  investigation  it  was  finally  recommended  that  these 
higher  class  vessels  should  be  built  of  steel  throughout,  for  it  was  the 
feeling  of  the  board  that  for  the  reputation  and  national  advantages 
of  the  United  States,  it  is  of  prime  necessity  that  in  this  country, 
where  every  other  industry  is  developing  with  gigantic  strides,  a  bold 
and  decided  step  should  be  taken  to  win  back  from  Europe  our  former 
prestige  as  the  best  shipbuilders  of  the  world.  As  to  the  rigging,  it 
was  the  opinion  of  the  board  that  "all  classes  of  vessels  should  have 
full  sail  power. "  It  was  not  until  1887  that  the  practice  of  full  sail 
rig  was  abandoned  for  cruising  vessels.  The  Maine,  blown  up  in 
the  Havana  harbor,  was  the  last  so  designed,  but  before  completion 
the  sail  rigging  gave  way  to  military  masts. 

The  whole  program  recommended  called  for  an  immediate  addi- 
tion to  the  navy  of  eighteen  steel  unarmored  cruisers  having  a  dis- 
placement of  3043  tons  to  5873  tons,  and  twenty  fourth-rate  wooden 
cruisers  having  a  displacement  of  about  793  tons  and  an  average 
speed  of  ten  knots.  Besides  these  there  were  to  be  thirty  small 
vessels  making  sixty-eight  in  all.  The  total  cost  of  the  vessels  rec- 
ommended was  estimated  at  $29,607,000.148 

148  House  Exec.  Doc.,  vol.  8,  no.  1,  p.  3,  p.  28,  47  Cong.,  seas.  1. 


56  GOVERNMENT   AID    TO   AMERICAN   SHIPBUILDING 

Congress  responded  to  this  elaborate  recommendation  but  very 
weakly.  By  an  act  passed  August  5,  1882,149  it  provided  for  the 
construction  of  two  large  steel  cruisers  with  full  steam  power.  This 
act  also  provided  for  the  appointment  of  a  naval  advisory  board  to 
serve  during  the  construction  and  trial  of  these  vessels.  It  was  to 
be  the  duty  of  the  board  to  advise  and  assist  the  secretary  of  the  navy 
in  all  matters  relative  to  the  construction  of  these  vessels.  This 
board  recommended  that  the  government  abandon  the  plan  to  build 
the  larger  of  the  two  cruisers  authorized  by  the  act  of  August  5, 
1882,  because  it  was  estimated  that  it  would  cost  $2,700,000,  about 
$1,000,000  more  than  the  estimate  made  by  the  first  board.  It 
was  also  now  recommended  that  instead  of  this  first-class  cruiser 
of  5873  tons  there  should  be  constructed  three  steel  cruisers  of  about 
2500  tons,  a  fast  clipper  and  a  torpedo  boat.  The  board  also  rec- 
ommended the  completion  of  four  double-turreted  monitors  begun 
in  the  early  seventies.150 

Acting  upon  these  recommendations,  Congress  in  the  act  of 
March  3,  1883,161  appropriated  $1,000,000  for  the  completion  of  the 
four  monitors  but  the  next  Congress  withdrew  the  unexpended  bal- 
ance and  also  adopted  the  recommendation  of  the  advisory  board  in 
the  construction  of  four  steel  cruisers  instead  of  two  large  ones  as  pro- 
vided for  in  the  act  of  August  5,  1882.  Under  this  act  a  contract 
was  now  made  with  John  Roach,  and  the  Chicago,  the  Boston,  the 
Atlanta  and  the  Dolphin  were  built  in  his  yard  at  Chester,  Pa.  This 
was  accomplished  only  after  a  great  deal  of  experimenting,  for  Amer- 
ican shipbuilders  had  neither  the  knowledge  nor  the  equipment  nec- 
essary for  steel  shipbuilding  when  these  were  authorized.  The  long 
delay,  the  changing  plans,  and  the  growing  cost  aroused  suspicions 
which  put  the  naval  advisory  board  on  the  defensive.  In  a  report 
submitted  to  the  House  of  February  12,  1885,152  the  board  explains 
that  the  additional  sost  has  been  reasonable,  that  the  changes  have 
been  unavoidable  on  account  of  the  lack  of  experience  in  this  country 
in  building  such  ships  and  that  the  government  should  pay  for  parts 
of  ships  that  failed  to  stand  the  test  in  the  trials  because  of  our  inex- 
perience in  the  manufacture  of  steel.  In  submitting  this  report  Sec- 

149  47  Cong.,  sess.  1.,  ch.  391. 

160  Sen.  Exec.  Doc.,  vol.  3,  no.  74,  pp.  15  and  31,  47  Cong.,  sess.  2. 

161  47  Cong.,  sess.  2,  ch.  97. 

162  H.  Exec.  Doc.  No.  220,  vol.  28,  48  Cong.,  sess.  2. 


GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING  57 

retary  of  the  Navy  Chandler  reminds  Congress  that  "  Patience,  for- 
bearance, and  liberal  treatment  of  the  manufacturers  are  necessary 
in  order  to  encourage  them  to  undertake  the  development  of  the 
production  in  this  country  of  steel  plate  and  armor  for  naval  vessels 
and  ingots  for  heavy  cannon."  And,  on  the  whole,  this  has  been 
the  policy  of  the  government  since  then  toward  our  shipbuilders 
when  doing  heavy  work  for  the  navy. 

By  the  act  of  March  3,  1885,153  Congress  appropriated  $25,000, 
for  testing  American  armor  made  of  American  material,  and  set 
aside  nearly  $2,000,000  for  the  further  increase  of  the  navy  by  the 
addition  of  two  cruisers  and  two  gunboats.  The  cruisers  were  to 
be  of  not  less  than  3000  tons  nor  more  than  5000  tons  displacement 
and  were  to  cost  not  more  than  $1,100,000. 

The  act  of  August  5,  1882,  also  provided  that  no  wooden  vessel 
should  be  repaired  when  the  cost  of  repair  would  exceed  30  per  cent 
of  the  cost  to  build  a  new  vessel  of  the  same  size  and  similar  construc- 
tion. In  1883  this  limit  at  which  such  vessels  might  be  repaired 
was  made  20  per  cent  and  since  1892154  it  has  been  the  policy  not  to 
repair  wooden  vessels  when  the  cost  of  repairs  would  exceed  10  per 
cent  of  the  cost.  This  has  helped  to  rid  the  navy  of  the  obsolete 
wooden  vessels  and  has  been  a  factor  in  the  development  of  steel 
shipbuilding. 

Since  the  inauguration  of  this  new  naval  policy,  every  Congress 
has  made  some  addition  to  the  navy  and  the  appropriations  for  this 
purpose  have  grown  from  a  few  million  dollars  a  year  to  upwards  of 
thirty  millions  a  year.  By  the  act  of  August  3, 1886, 155  Congress  pro- 
vided for  our  first  armored  cruisers,  the  Maine  and  the  Texas,  one 
smaller  cruiser  and  a  first-class  torpedo  boat.  The  cruisers  were  to 
be  of  about  6000  tons  displacement,  to  have  a  speed  of  at  least  six- 
teen knots.  They  were  to  be  built  of  American  steel.  The  armor 
was  also  to  be  of  domestic  manufacture,  if  it  could  be  "obtained  in 
a  reasonable  time  at  a  reasonable  price,  and  of  the  required  quality." 
The  engines,  boilers  and  machinery  were  also  to  be  of  domestic  man- 
ufacture but  the  shafting  might  be  purchased  abroad,  if  it  could  not 
be  obtained  here.  This  act  also  provided  for  the  completion  of  the 
four  unfinished  double-turreted  monitors  which  had  been  begun  more 

153  48  Cong.,  sess.  2,  ch.  344. 

154  50  Cong.,  sess.  1,  ch.  206. 

155  49  Cong.,  sess.  1,  ch.  849. 


58  GOVERNMENT   AID   TO   AMERICAN   SHIPBUILDING 

than  a  decade  ago.  One  of  the  new  vessels  was  to  be  built  in  a  navy 
yard,  and  at  least  one  of  the  monitors  was  to  be  finished  in  a  govern- 
ment yard.  This  act  is  important  because  it  embodies  the  general 
policy  of  the  government  in  building  the  navy.  Practically  all  the 
acts  authorizing  additions  to  the  navy  down  to  the  present  time  pro- 
vide that  the  vessels  shall  be  built  under  the  terms  stipulated  in  this 
act  of  August  3,  1886. 

A  few  modifications  have  been  made  from  time  to  time.  Several 
new  features  appeared  in  the  act  passed  at  the  next  session  of  Con- 
gress,156 authorizing  the  construction  of  two  more  steel  cruisers.  One 
of  these  was  the  offer  of  premiums  for  speed  in  excess  of  that  required 
by  the  contract.  Fifty  thousand  dollars  was  to  be  paid  for  every 
knot  in  excess  of  nineteen  knots  an  hour  that  the  vessels  could  show 
in  the  trials.  Later  acts  have  generally  provided  for  similar  speed 
premiums  at  the  rate  of  $50,000  for  every  quarter-knot  in  excess  of 
the  maximum  speed  required  by  the  contract.157  Another  new  pro- 
vision in  this  act,  which  has  since  become  a  fixed  feature  of  our  policy, 
was  that  an  attempt  should  be  made  to  have  one  of  the  vessels  built 
on  the  Pacific  coast  or  the  Gulf  coast.  But  if  this  could  not  be  done 
at  a  reasonable  price  then  the  President  might  designate  the  place 
where  it  should  be  done.  Since  1896  the  acts  have  generally  pro- 
vided that  some  of  the  ships  were  to  be  built  on  the  Pacific  coast  on 
condition  that  they  could  be  built  at  an  additional  cost  not  exceeding 
4  per  cent  of  the  lowest  bid  accepted  for  similar  work.  By  1893 
our  experience  in  building  for  the  navy  had  made  us  more  confident 
and  independent.  Since  then  Congress  has  modified  the  conditions 
of  the  act  of  1886  by  requiring  absolutely  that  all  materials  used  in 
the  constructions  of  naval  vessels  must  be  of  domestic  manufacture. 

Some  of  the  earlier  acts  provided  that  the  government  should 
build  some  of  the  vesels  authorized  in  the  navy  yards  if  it  could  be 
done  at  a  reasonable  cost,  but  up  to  the  close  of  the  Spanish  War  tjie 
government  built  very  few  itself.  There  were  then  a  total  of  one 
hundred  and  eighty-nine  vessels  in  the  navy  including  the  fifty-five 
which  were  under  construction.  Of  that  number  the  government 
had  built  only  a  second-class  battleship  and  an  unarmored  cruiser 
besides  some  of  the  oldest  vessels  in  the  navy.  The  twelve  first- 

156  Act  of  March  3,  1887,  49  Cong.,  sess.  2,  ch.  391. 

167  Act  of  September  7,  1888,  50  Cong.,  sess.  1,  ch.  998. 


GOVEKNMENT   AID   TO   AMERICAN   SHIPBUILDING  59 

class  battleships  had  all  been  let  by  contract  for  construction  in 
private  establishments. 

Cramps  at  Philadelphia  built  five  of  these,  the  Alabama,  the  Indi- 
ana, the  Iowa,  the  Massachusetts  and  the  new  Maine.  Four  of 
them  the  Illinois,  the  Kentucky,  the  Kearsarge,  and  the  Missouri  were 
built  by  the  Newport  News  Shipbuilding  and  Dry  Dock  Company. 
The  remaining  three,  the  Ohio,  the  Oregon  and  the  Wisconsin  were 
built  by  the  Union  Iron  Works  at  San  Francisco.  Of  the  other  ves- 
sels in  the  navy  then,  Cramps  had  built  by  far  the  most,  but  the 
other  establishments  on  the  Delaware  at  Philadelphia,  Chester  and 
Wilmington  had  also  built  a  large  number.158 

Since  the  Spanish  War  the  demands  on  our  shipbuilders  for 
naval  construction  have  been  increased  and  constant.  The  war  left 
us  in  possession  of  the  Philippines  and  Porto  Rico.  Hawaii  had  just 
been  acquired.  The  United  States  now  became  a  world  power  with 
political  and  commercial  interests  over  the  seas,  which  have  made 
increased  naval  strength  imperative. 

In  the  year  of  the  Spanish  War,  the  increase  to  the  regular 
navy  provided  for  an  addition  of  three  first-class  battleships  and  a 
large  number  of  smaller  vessels  having  a  total  displacement  of  nearly 
sixty  thousand  tons.  This  increase  was  nearly  twice  as  great  as  that 
of  any  other  year  'since  the  inauguration  of  the  new  naval  policy. 
Yet  the  following  year,  the  total  increase  authorized  amounted  to  a 
total  displacement  of  105,084  tons,  including  six  vessels  having  a 
displacement  of  more  than  13,600  tons  each.  The  next  year,  1900,  the 
increase  authorized  also  exceeded  the  100,000  ton  mark.  Since  then 
the  addition  for  a  single  year  has  not  been  so  great,  still  there  has 
been  a  very  substantial  increase  each  year.159  So  that  by  1909, 
the  total  number  of  vessels  in  the  navy  including  those  unders  con- 
struction was  three  hundred  and  sixty-two,  of  which  number  two 
hundred  and  ninety-five  were  fit  for  service.160  The  total  expenditure 
of  the  government  for  the  additions  to  the  navy  since  1883  had  reached 
by  June  30, 1909,  the  sum  of  $367,273,407.68.  By  far  the  largest  part 
of  this  was  paid  to  a  comparatively  small  number  of  private  yards. 

158  See  Report  of  the  secretary  of  the  navy,  55  Cong.,  Sess.  3,  House  Doc. 
No.  3,  vol.  xi,  pp.  526-588,  for  a  description  of  all  the  vessels  in  the  navy  and 
a  table  showing  where  they  were  built. 

159  Navy  Year  Book,  1909,  pp.  650,  651. 

160  Navy  Year  Book,  1909,  p.  659. 


60  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

Besides  this  sum  millions  have  been  paid  to  private  yards  for  repairs 
and  other  work. 

The  most  marked  advance  in  recent  years  has  been  in  the  size 
and  character  of  the  first-class  battleships.  The  Delaware  and  the 
North  Dakota  were  the  first  of  the  "  dreadnaught"  type  having  a 
displacement  of  20,000  tons  and  a  speed  of  twenty-one  knots  an 
hour.  Since  then  there  have  been  authorized  the  Florida  and  the 
Utah  of  nearly  22,000  tons  and  more  recently  the  Arkansas  and  the 
Wyoming  of  26,000  tons  each.  When  it  is  remembered  that  our 
largest  battleships  in  the  Spanish  War,  the  Indiana,  the  Massachu- 
setts, and  the  Oregon  were  of  only  10,288  tons  displacement,  the 
advance  made  since  that  time  becomes  apparent. 

This  country  is  now  building  naval  vessels  second  to  none  in 
the  world.  The  liberal  patronage  of  the  government  has  enabled 
some  of  our  builders  to  develop  their  plants  into  establishments  of 
the  highest  efficiency.  These  plants  represent  investments  of  large 
amounts  of  capital.  The  William  Cramp  &  Sons  Ship  and  Engine 
Building  Company  of  Philadelphia  reports  an  investment  of  $16,000- 
000  capital,  and  the  New  York  Shipbuilding  Company  of  Camden, 
N.  J.,  reports161  a  capital  of  $10,000,000  invested.  These  are  the 
largest  but  there  are  in  the  country  about  a  dozen  other  establish- 
ments, each  with  a  capital  of  $2,000,000  and  upwards.  Our  largest 
and  most  efficient  establishments  certainly  owe  their  existence  to 
the  naval  policy  of  the  government.  Nor  should  the  effect  of  this 
government  patronage  upon  our  steel  industries  be  forgotten.  Yet 
our  steel  manufacturers  have  been  charging  our  builders  $10  a  ton 
more  for  steel  plate  than  they  charged  British  builders.162 

But  the  most  important  result  of  our  recent  naval  policy  upon 
shipbuilding  is  that,  along  with  the  assemblage  of  capital  and  the 
physical  equipment  of  our  steel  plants  and  shipyards,  there  has 
developed  a  skill  in  marine  architecture  and  construction  of  the 
highest  order.  Our  shipbuilders  are  ready  to  supply  the  ships  if  our 
legislators  can  devise  a  commercial  policy  that  will  create  a  demand 
for  them. 


61  Report  of  Commissioner  of  Navigation,  1910,  p.  15. 
U2  Report  of  the  Merchant  Marine  Commission,  p.  ix. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  61 

CONCLUSION 

During  the  colonial  period  shipbuilding  flourished  because  the 
colonists  scattered  along  the  Atlantic  coast  were  a  maritime  people; 
their  commerce,  domestic  as  well  as  foreign,  was  carried  on  in  ships; 
and  there  were  at  hand  an  adequate  supply  of  timber  and  other 
materials  for  building  and  equipping  vessels.  In  short  shipbuilding 
flourished  because  it  rested  upon  a  sound  economic  basis.  Political 
conditions  were  favorable  to  it,  and  especially  did  the  British  navi- 
gation acts  protect  colonial  shipping  and  shipbuilding  from  all  for- 
eign competition. 

After  the  Revolution  these  industries  were  unable  to  maintain 
themselves  in  spite  of  the  fact  that  the  purely  economic  conditions 
remained  the  same.  They  needed  political  protection  to  take  the 
place  of  the  navigation  acts.  The  policy  of  commercial  liberty  soon 
gave  way  to  a  policy  of  national  protection.  Under  the  favorable 
economic  conditions  and  the  political  protection  now  provided  nav- 
igation and  shipbuilding  soon  became  so  thoroughly  established  that 
reciprocity  treaties,  which  abolished  all  political  protection,  did  not 
materially  affect  the  prosperity  of  these  industries. 

Soon  after  this  change  in  government  policy,  there  came  changes 
in  economic  conditions  which  vitally  affected  both  shipping  and  ship- 
building.    England  began  to  build  steamships  just  as  American  build- 
ers had  attained  the  highest  perfection  in  sailing  vessels.    So  great  was 
the  success  of  American  shipbuilding  then  that  its  momentum  car- 
ried it  along  through  the  record  decade  of  the  fifties.    Then  England   J  J  , 
began  to  build  iron  ships  and  now  had  all  the  advantages  over  the 
United  States  which  this  country  had  over  England  in  building  wooden 
sailing  vessels.     The  invention  of  agricultural  machinery  and  the 
extension  of  railroads  opened  the  West  to  the  most  enterprising  young 
men  and  called  for  a  large  share  of  American  capital  promising  large 
returns.     The  Civil  War  did  its  destructive  work.     European  sub-  ?* 
sidies  strengthened  our  competitors.     The  inadequate  American  sub- 
sidies did  not  yield  satisfactory  returns.     War  taxes  and  "protec-  fo, 
tive"  tariffs  burdened  shipbuilding  heavily. 

The  building  of  ocean  steamships  in  the  United  States  came  in 
response  to  the  mail  subsidies  offered  by  the  government.  These 
payments  were  sufficient  to  establish  steamship  building  thoroughly 
before  the  Civil  War.  The  demands  of  the  government  upon  pri- 


62  GOVERNMENT  AID   TO  AMERICAN  SHIPBUILDING 

vate  yards  for  war  vessels  kept  them  busy  during  the  war  and  left 
iron  and  steam  shipbuilding  in  a  high  state  of  efficiency  at  the  end  of 
the  war.  The  most  important  commercial  steamships  built  in  the  (/ 

decade  following  the  war  were  for  the  subsidized  Brazilian  and  Ori- 
ental mail  services.  The  next  great  advance  in  building  modern 
steamships  for  ocean  commerce  was  under  the  provisions  of  the 
ocean  mail  act  of  1891  and  the  registry  act  which  led  to  the  construc- 
tion of  the  St.  Louis  and  the  St.  Paul.  Whatever  might  have  been 
.  the  result  if  the  government  had  followed  continuously  the  policy 
of  granting  liberal  mail  subsidies  to  ocean  steamship  lines,  the  fact 
remains  that  the  only  great  advances  ever  made  in  building  steam- 
ships for  the  foreign  trade  have  come  in  response  to  the  aid  granted 
by  Congress. 

The  repeal  of  the  war  taxes  and  the  tariff  concessions  came  too 
late.  Foreign  shipbuilding  had  been  too  securely  established.  The 
restriction  on  vessels  constructed  of  free-list  materials  in  the  coasting 
trade  has  made  the  tariff  concessions  of  little  practical  value. 

The  policy  of  granting  American  registry  only  to  American-built 
ships  was  of  unquestioned  advantage  until  after  the  Civil  War.  For 
the  period  since  then  the  wisdom  of  strict  adherence  to  this  policy 
may  well  be  questioned.  An  unlimited  "free  ship"  policy  would 
certainly  have  proved  disastrous  to  American  shipbuilding,  and  it 
is  sound  policy  to  reserve  the  coastwise  trade  for  ships  of  domestic 
build;  but  in  the  foreign  trade  it  might  have  been  of  some  advantage, 
before  the  development  of  the  American  steel  industries,  to  have 
allowed  the  purchase  of  iron  and  steel  steamships  abroad.  This 
might  have  aided  our  shipping  and  could  not  have  injured  ship- 
building. Indeed,  it  would  probably  have  quickened  its  develop- 
It  is  also  to  be  regretted  that  the  government  did  not  adopt 
as  a  general  policy  the  principle  in  the  act  authorizing  the  registry 
of  the  New  York  and  the  Paris,  that  of  admitting  high-class  foreign- 
built  steamships  on  condition  of  an  equal  tonnage  of  similar  ships 
being  built  in  this  country.  Any  ships  built  in  this  country  under 
such  conditions  would  have  been  clear  gain.  But  the  adoption  of 
such  a  policy  now  would  not  be  sufficient  inducement  to  yield  very 
important  results.  Yet  the  United  Fruit  Company  made  a  request 
of  the  last  Congress  of  such  a  privilege,  but  it  was  refused.  Amer- 
ican shipbuilders  could  lose  nothing  if  Congress  were  to  allow  for- 
eign-built ships  to  be  registered  for  the  foreign  trade  for  a  period 


GOVERNMENT  AID  TO   AMERICAN  SHIPBUILDING  63 

of  years  and  if  this  increased  our  foreign  shipping,  it  might  help  them 
in  the  long  run.  The  evidence  before  the  American  Merchant  Ma- 
rine Commission  indicated  strongly  that  Americans  owning  foreign 
fleets  could  not  afford  to  operate  them  under  the  American  flag. 
While  it  would  have  been  a  reasonable  experiment  to  have  relaxed 
our  stringent  registry  policy  somewhat,  it  would  not  have  produced 
any  really  great  results. 

The  two  most  important  features  of  our  government  policy  in    / 
aid  of  American  shipbuilding  are  the  reservation  of  the  coastwise 
trade  to  American-built  ships  and  the  liberal  patronage  of  the  gov- 
ernment in  building  the  new  navy  in  private  yards.     These  form  the  I 
legal  foundation  upon  which  the  whole  industry  of  American  ship- 
building rests.     It  is  due  to  these  and  especially  the  latter  that  this 
country  possesses  establishments  with  the  equipment  and  skill  capa- 
ble of  constructing  vessels  of  the  highest  order. 

BIBLIOGRAPHY 
PART  I.    POLICY  BEFORE  1789 

Public  Documents 

The  Statutes  of  the  Realm,  printed  by  command  of  His  Majesty,  King 
George  III. 

Acts  of  the  Privy  Council  of  England,  Colonial  Series.  Edited  through  the 
direction  of  the  Lord  President  of  the  Council  by  W.  L.  Grant  and 
James  Munro,  Hereford,  1910 

Colonial  Laws.  The  Charlemagne  Tower  Collection  of  American  Colonial 
Laws  in  the  library  of  the  Pennsylvania  Historical  Society  Philadel- 
phia. This  is  a  very  extensive  collection  and  especially  valuable 
because  it  contains  a  large  number  of  the  original  session  laws.  It  con- 
tains the  first  extant  edition  issued  by  each  of  the  thirteen  colonies 
that  formed  the  United  States,  except  Rhode  Island,  New  Jersey,  and 
Maryland,  aud  in  nearly  every  case  the  first  edition  is  supplemented 
by  almost  all  the  later  editions  issued  prior  to  1800.  It  includes  some 
collection  of  laws  of  every  colony.  The  catalogue  of  titles  comprises 
more  than  two  hundred  and  fifty  pages  which  indicates  at  once  the 
extent  of  the  collection  and  the  futility  of  a  complete  description  here. 
Among  the  most  convenient  collections  of  colonial  laws  the  following 
may  be  mentioned : 

Connecticut.  The  Book  of  the  General  Laws  for  the  People  within  the  Ju- 
risdiction of  Connecticut  Collected  and  Published  by  the  Authority 
of  the  General  Court,  1673.  There  was  an  exact  reprint  of  this  at 
Hartford,  1865. 


64  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

Connecticut.  Acts  and  Laws  of  His  Majesty's  English  Colony  of  Connecti- 
cut, in  New  England  in  America,  1769.  The  Tower  collection  also 
contains  the  session  laws  from  1715  to  1793  besides  the  collections 
made  in  1715  and  1750. 

Delaware.  Laws  of  the  Government  of  New  Castle,  Kent  and  Sussex  upon 
the  Delaware.  Published  by  Order  of  the  Assembly,  1752. 

The  Tower  collection  contains  also  the  collection  of  1741  in  addition  to 

some  of  the  later  session  laws. 
Georgia.    Acts  passed  by  the  General  Assembly  of  the  Colony  of  Georgia, 

1755  to  1774.    Printed  1881. 
Maryland.    Laws  of  Maryland  at  Large.    By  Thomas  Bacon,  Baltimore,  1765. 

Laws  of  Maryland  made  since  1763,  etc.  to  1787. 

Massachusetts.  The  Book  of  the  General  Laws  and  Liberties  Concerning  the 
inhabitants  of  Massachusetts,  Cambridge,  1660. 

There  is  a  reprint  of  this  collection  with  the  session  laws  to  1670.  Printed 
at  Boston,  1889. 

A  similar  collection  of  the  General  Laws  and  Liberties  made  in  1672  was 
reprinted  in  Boston,  1887. 

The  Charlemagne  Tower  collection  of  Massachusetts  laws  is  very  complete. 

The  Acts  -and  Resolves  of  the  Province  of  Massachusetts  Bay  1692  to 
1780,  vols.  i  to  v,  Boston,  1869-1886. 

Records  of  the  Governor  and  Company  of  the  Massachusets  Bay  in  New 
England  printed  by  order  of  the  Legislature.  Edited  by  Nathaniel 
B.  Shurtleff,  Boston,  1853-54,  5  vols. 

Although  not  a  public  document,  for  want  of  a  better  place,  there  may 
also  be  mentioned  here,  Thomas  Hutchinson's  History  of  Massachu- 
setts from  the  Settlement  in  1628  until  1774,  vol.  i,  3d  edition,  printed 
at  Salem;  vol.  ii,  3d  edition,  at  Boston,  1795;  vol.  iii,  at  London,  1798. 
New  Hampshire.  Acts  and  Laws  Passed  by  the  General  Court,  Portsmouth, 
1716.  A  reprint  of  this  edition  with  the  session  laws  down  to  1726 
was  made  in  1889. 

Acts  and  Laws  of  His  Majesty's  Province  of  New  Hampshire  in  New  Eng- 
land with  Sundry  Acts  of  Parliament,  1759. 

There  was  a  collections  under  a  similar  title  in  1771. 

New  Jersey.  The  Grants,  Concessions  and  Original  Constitutions  of  the  Prov- 
ince of  New  Jersey.  The  Acts  Passed  during  the  Proprietary  Gov- 
ernments, etc.  By  Aaron  Learning  and  Jacob  Spicer,  1758. 

Acts  of  the  General  Assembly  of  the  Province  of  New  Jersey  from  1753 

to  1761 .    By  Samuel  Nevill. 

New  York.  The  Colonial  Laws  of  New  York  from  the  year  1664  to  the  Revolu- 
tion. 5  vols.  Albany,  1886-1894. 

Laws  of  New  York  from  the  year  1691  to  1789  inclusive.     2  vols. 

Documents  relative  to  the  Colonial  History  of  the  State  of  New  York,  pro- 
cured in  Holland,  England  and  France,  by  John  Romey  Brodhead 
under  the  authority  of  an  act  of  the  Legislature.  Albany,  1856- 
1881,  13  vols. 


GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING  65 

North  Carolina.  A  Complete  Revisal  of  all  the  Acts  of  the  Province  of  North 
Carolina  now  in  force  and  use,  together  with  the  titles  of  all  such  as 
are  obsolete,  expired  or  repealed,  1773. 

Pennsylvania.  The  Laws  of  the  Province  of  Pennsylvania  Collected  into  One 
Volume  by  Order  of  the  Governor  and  Assembly  of  the  said  Province. 
Philadelphia,  1714. 

Statutes  at  Large  of  Pennsylvania  from  1682  to  1782.  Compiled  by  J. 
T.  Mitchell  and  Henry  Flanders,  vols,  ii  to  xi,  1896-1906.  The  first 
volume  covering  twenty  years  before  1700  has  not  yet  appeared. 

Rhode  Island.    Acts  and  Laws  of  His  Majesty's  Colony  of  Rhode  Island  and 

Providence  Plantations  in  New  England  in  America,  1745. 
Acts  and  Laws  of  His  Majesty's  Colony  of  Rhode  Island  and  Providence 

Plantations  in  America  from  1745  to  1752. 

Acts  and  Laws  of  the  English  Colony  of  Rhode  Island  and  Providence 
Plantations  in  New  England  in  America,  1767.  This  is  the  fourth 
revision. 

South  Carolina.  The  Statutes  at  Large  of  South  Carolina,  Edited  under  au- 
thority of  the  Legislature  by  Thomas  Cooper.  Columbia,  1836. 

Virginia.  Statutes  at  Large,  being  a  Collection  of  all  the  Laws  of  Virginia 
from  the  First  Session  of  the  Legislature  in  the  Year  1619.  By  Wil- 
liam Waller  Hening.  Vols.  I-XII.  Richmond,  1809-1823. 

Secondary  Sources 

Beer,  George  L.    The  Commercial  Policy  of  England  Toward- the  American 
Colonies,  in  Columbia  University  Studies,  iii,  no.  2,  New  York,  1893. 
British  Colonial  Policy  1754  to  1765,  New  York,  1907. 
The  Origins  of  the  British  Colonial  System,  1578  to  1660,  New  York,  1908. 

Chalmers,  George.  An  Introduction  to  the  History  of  the  Revolt  of  the  Amer- 
ican Colonies,  Boston,  1845. 

Giesecke,  Albert  A.  American  Commercial  Legislation  Before  1789.  New 
York,  1910. 

Hill,  William.  The  First  Stages  of  the  Tariff  Policy,  in  the  Publications  of 
the  Ame'rican  Economic  Association,  1893. 


PART  II.    NATIONAL  LEGISLATION  SINCE  1789 
Public  Documents 

United  States  Statutes  at  Large.     Published  by  authority  of  Congress. 

Annals  of  Congress.  The  Debates  and  Proceedings  in  the  Congress  of  the 
United  States  with  an  appendix  containing  important  state  papers 
and  public  documents  with  a  copious  index.  Compiled  (at  the 
.  beginning)  by  Joseph  Gales,  Sr.,  Washington,  1834. 

Abridgement  of  the  Debates  of  Congress  from  1789  to  1856.  By  Thomas  H. 
Benton,  New  York,  1860. 


66  GOVERNMENT  AID   TO   AMERICAN   SHIPBUILDING 

Congressional  Globe  containing  Sketches  of  the  Debates  and  Proceedings  of 
the  Twenty-third  Congress  continued  to  the  end  of  the  Forty-second 
Congress.  Washington  1834  to  1872.  i 

Congressional  Record,  containing  the  Proceedings  and  Debates  of  the  Forty- 
third  Congress  First  Session  (continued  to  the  Present)  Washington  i 
1874  to  date. 

Congressional  Documents.  The  most  important  of  the  Congressional  Docu- 
ments cited  in  the  notes  are  the  following: 

American  State  Papers: 

Documents,  Legislative  and  Executive  of  the  Congress  of  the  United 
States,  Selected  and  Edited  under  the  Authority  of  Congress,  by 
Walter  Lowrie,  Secretary  of  the  Senate,  and  Matthew  St.  Claire  Clarke, 
Clerk  of  the  House  of  Representatives.  Commerce  and  Navigation, 
Finance,  Washington,  1832.  These  contain  memorials,  etc.,  show- 
ing the  condition  of  shipbuilding  at  the  beginning  of  the  national 
legislation. 

32d  Congress  1st  session,  House  Executive  Documents  No.  91,  No.  124  and  No. 
127.  They  contain  the  contracts  for  the  steamers  subsidized  under 
the  acts  of  1854  and  1847,  also  a  description  of  the  steamers  built. 

41st  Congress,  2d  session,  House  Executive  Document,  No.  111.  A  report  by 
Joseph  Nimmo,  Jr.  which  contains  much  valuable  information  on  the 
work  done  in  private  yards  for  the  government  during  the  Civil  War, 
besides  much  information  concerning  the  condition  of  shipbuilding 
after  the  Civil  War. 

41st  Congress,  2d  session,  House  Report  No.  28.  This  is  the  well  known  Lynch 
Report  made  February  17,  1870.  It  contains  the  evidence  obtained 
in  the  first  thorough  investigation  into  the  causes  of  the  decline  of 
American  shipping  in  the  foreign  trade  and  the  stagnation  in  America 
shipbuilding  after  the  Civil  War.  In  connection  with  it,  are  a  number 
of  valuable  tables  including  one  which  shows  the  number  and  the  names 
of  all  the  vessels  built  by  and  for  the  government  for  the  Navy  Depart- 
ment since  April  1,  1861  with  their  tonnage,  number  of  guns,  by  whom 
built  and  the  cost  of  each,  and  the  time  occupied  in  construction. 

43d  Congress,  2d  session,  House  Report  No.  268.  Report  on  the  investiga- 
tion of  the  corrupt  lobbying  to  secure  the  increased  mail  service  to 
the  Orient. 

47th  Congress,  2d  session,  House  Report  No.  1827.  A  report  made  December 
15, 1882  by  the  Joint  Select  Committee  on  American  Shipping  contain- 
ing opposite  views  of  the  "free  ship"  question  and  statements  from 
shipbuilders  and  shipowners  regarding  the  effects  of  the  tariff  and  tax- 
ations on  the  decline  of  American  shipbuilding  and  shipping. 

47th  Congress  1st  session,  House  Executive  Document  No.  1  part  3.  This  is 
the  report  of  the  Naval  Advisory  Board  containing  the  program  for 
the  new  navy,  Nov.,  1881. 

47th  Congress,  2d  session  Senate  Executive  Document  No.  47.  Report  of  the 
Naval  Advisory  Board. 


GOVERNMENT  AID   TO  AMERICAN  SHIPBUILDING  67 

48th  Congress,  2d  session  House  Executive  Document  No.  220.  Later  re- 
port of  the  Naval  Advisory  Board. 

50th  Congress,  1st  session,  House  Report  1874  and  Senate  Report  No.  2332. 
Further  light  on  the  "free  ship"  controversy  and  its  relation  to  the 
general  question  of  "free  trade"  vs.  "protection." 

55th  Congress,  3d  session,  House  Executive  Document,  No.  3,  vol.  xi.  Re- 
port of  the  Secretary  of  the  Navy  in  the  year  of  the  Spanish  War  con- 
taining full  information  on  the  building  of  the  "New  Navy"  up  to 
that  time. 

58th  Congress,  3d  session,  Senate  Report  No.  2755.  This  is  the  Report  of 
the  Merchant  Marine  Commission  rendered  in  January,  1905.  The 
three  volumes  containing  the  report  and  the  testimony  taken,  present 
a  complete  view  of  the  whole  merchant  marine  question  at  a  recent 
date. 

61st  Congress,  2d  session,  Senate  Document,  No.  195.  This  is  the  Navy  Year- 
book, a  compilation  of  the  Annual  Naval  Appropriation  laws  from 
1882  to  1909,  including  provisions  for  the  construction  of  all  vessels  of  the 
"New  Navy"  with  tables  showing  the  present  naval  strength,  ves- 
sels and  personnel,  and  amount  of  appropriations  for  naval  service. 
Compiled  by  Pitman  Pulsifer,  clerk  to  the  Committee  of  Naval  Affairs, 
United  States  Senate. 

A  List  of  Books  on  Mercantile  Marine  Subsidies  complied  under  the  direction  of 
Appleton  Prentiss  Clark  Griffin,  Chief  Bibliographer  under  the  Li- 
brarian of  Congress,  Washington,  Government  Printing  Office  1906. 
This  list  contains  more  than  a  hundred  pages  of  bibliographical  ma- 
terial on  this  subject  including  a  long  list  of  secondary  books,  refer- 
ences to  the  principal  Congressional  documents,  a  list  of  the  principal 
speeches  in  Congress,  references  to  the  consular  reports  dealing  with 
this  subject  as  well  as  to  articles  in  periodicals.  It  is  an  indispen- 
sable guide  to  students  of  this  subject. 

Census  of  the  United  States,  1880,  vol,  viii,  pp.  189  to  276.  Report  on  the  Ship- 
building Industry  of  the  United  States,  by  Henry  Hall,  Special  Agent. 

Census  of  the  United  States,  1900,  vol.  x,  pp.  207  to  240.  Shipbuilding  by 
Alexander  R.  Smith,  Expert  Special  Agent. 

Census  Office  Special  Reports,  1905,  Manufactures,  part  iv,  pp.  331  to  353, 
Bulletin  81,  Report  on  Shipbuilding,  Census  Bulletin  91,  Transpor- 
tation by  Water,  1906. 

Annual  Reports  of  the  Commissioner  of  Navigation  especially  1910.  The 
Appendixes  to  these  reports  contain  valuable  tables  including  one  on 
the  class,  number  and  tonnage  of  vessels  built  in  each  year  from  1789 
to  1910,  another  showing  the  tonnage  of  foreign-built  vessels  admitted 
to  American  Register  each  year  1813  to  1910,  besides  many  similar 
ones. 

General  Secondary  Sources 

Bates,  Wm.  W.;  American  Navigation,  the  Political  History  of  its  Rise  and 
Ruin,  and  the  Proper  Means  for  its  encouragement.  New  York,  1902. 


68  GOVERNMENT   AID    TO   AMERICAN   SHIPBUILDING 

Marvin,  Winthrop,  L. ;  The  American  Merchant  Marine,  Its  History  and  Ro- 
mance from  1620  to  1902;  New  York,  1902. 

Meeker,  Royal;  History  of  Shipping  Subsidies,  1905.  Columbia  University 
Ph.D.  thesis,  also  published  in  American  Economic  Association  Publi- 
cations, series  3,  vol,  vi. 

Soley,  J.  R. ;  The  Maritime  Industries  of  America  in  Shaler,  The  United  States 
of  America,  1897,  vol.  1,  pp.  518  to  624. 

Wells,  David  Ames;  Our  Merchant  Marine,  How  It  Rose,  Increased,  Became 
Great,  Declined,  and  Decayed.  1889. 


•  - 


GENERAL  LIBRARY  -  U.C.  BERKELEY 


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